Japanese wage earners' total cash earnings rose 0.8 percent in December from a year earlier, government data showed on Wednesday, a second straight month of gains and the fastest climb in nearly two years - a sign of a gradual pickup in salaries.
Overtime pay, a barometer of strength in corporate activity, rose 4.6 percent in the year to December, up for a ninth consecutive month, labor ministry data showed.
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Reflecting improved corporate earnings on the back of the government's reflationary policies, special payments grew 1.4 percent from a year earlier, it showed, suggesting that winter bonuses may have increased for the first time in five years.
The Bank of Japan considers wage growth crucial in its battle to beat deflation and meet a 2 percent inflation target in roughly two years, which most economists believe is too ambitious.
The rise in total cash earnings in December was the fastest since March 2012.
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Regular pay fell 0.2 percent, down for 19 months in a row, the data showed, suggesting companies remain unconvinced about sustained economic growth and wary of increasing costs. The pace of declines, however, has slowed from the past several months.
"An increase in part-timers remains a drag on regular pay, but wages are holding steady on the whole... We're closely watching the outcome of the ongoing annual wage negotiations" between labor unions and management, a ministry official said.
Real wages, which takes into account consumer inflation, fell 1.1 percent year-on-year in December, down for a sixth straight month, but the pace of falls narrowed from prior months.
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For 2013, monthly average cash earnings stopped falling for the first time in three years, and they stood at 314,150 yen ($3,100), near a record low seen in the previous year.