TOKYO, Nov 7 Reuters Slightly more than half of Japanese firms are looking to raise wages by 3 or more for the next business year, a Reuters survey showed, but a majority of companies baulked at Prime Minister Shigeru Ishiba39;s quest to hike minimum pay by over 40 in five years.

The survey, conducted by Nikkei Research from Oct. 23 to Nov. 1, found 42 of the companies polled are considering wage hikes of 3 to 5 for the year starting April 2025, while 9 deemed an increase in the range of 5 to 7 possible.

About 41 said their wage increases will likely be in the range of 1 to 3. The survey reached 505 companies, with 240 responding.

After decades of slow wage growth, widely cited by economists and policymakers as a major impediment to boosting domestic demand and fostering sustainable economic growth, companies have started to address the pay issue in recent years.

Bank of Japan Governor Kazuo Ueda has said Japan must see wages rise sustainably for the central bank to consider hiking interest rates again.

More than twothirds survey respondents said their wage hikes for the next business year will be at the same level as for this year or higher, keeping momentum intact for pay increase.

Japanese companies delivered a wage hike of 5.1 on average this year, the biggest increase in three decades.

Some 52 of respondents said they intended to continue raising wages regardless of earnings fluctuations, while the rest showed no such intentions.

Hiring is getting tougher…