Results of a fact-finding survey on wages based on ability and type of work

On March 4, the Japan Productivity Center for Socio-Economic Development released the results of their fact-finding survey of wages by ability and type of work. The survey, carried out in response to the increasing fine-tuning to individuals of personnel treatment systems, aimed at sorting out new wage-related information that can replace the conventional seniority criteria for determining employee wages, such as age, number of years of service, sex, educational history, etc.

Of the Center's cooperating member corporations, the survey targeted 7,199 corporations and groups. A total of 556 valid responses were returned by mail. The response rate was 7.7%.

True, it is very difficult to accurately identify the status of wages based on ability and on work in Japan since, as the Center noted in this survey, "as things currently stand, Japanese companies have no wage structure or system that can accurately measure the going rates for wages that are increasingly determined according to work-related criteria." For this survey, the Center first investigated the going rates of wages that are determined based on ability (qualification/eligibility grades) criteria, then studied the distribution and proportion of the employees engaged in a particular type of job, according to their qualification/eligibility grade, so as to indirectly find the going rates of wages according to type of job. Some interesting findings were obtained as a result.

Companies employing 100 or fewer employees had 8.4 qualification/eligibility grade criteria in place, while those employing 1,000 or more employees had 10.7. The larger a company, the greater the number of grade criteria they have set. On average, there were 9.4 grades. By type of business, banking and insurance companies had 14.6, and electricity, gas, water, and heat suppliers had 11.8, followed by textile product manufacturers and chemical/pharmaceutical companies.

The going rates of wages determined based on ability (qualification/eligibility grades) were 201,000 yen for general, non-career grade III jobs (the starting salary for college graduates); 346,000 yen for posts corresponding to subsection chiefs and heads; 435,000 yen for posts corresponding to section managers; and 565,000 yen for posts corresponding to department heads.

Regarding the going rates of wages determined based on work (type of job)

criteria, the survey revealed the following:

1. The scheduled cash earnings of sales and sales-related jobs were 312,000 yen for Grade II sales staff, 329,000 yen for Grade I sales staff, 333,000 yen for sales leaders, 391,000 yen for Grade III sales managers, 455,000 yen for Grade II sales managers, and 528,000 yen for Grade I sales managers. As seen, the salaries were higher in proportion to the scale and scope of employees' roles and responsibilities.

2. A bipolar trend was seen in system engineer-related jobs, with operators (250,000 yen) and programmers (275,000 yen) forming a low-wage standard group, and, with sales engineers (324,000 yen) in the middle, project leaders (426,000 yen) and system consultants and system analysts (455,000 yen) forming a high-wage standard group.

3. As for clerical and planning-related jobs, wages were 270,000 yen for clerical employees, 417,000 yen for leaders in the clerical department, 400,000 yen for management planners, and 528,000 yen for leaders in the management planning departments.

Companies that sent in their replies were located throughout Japan and covered a wide range of business categories. They had 977.6 full-time employees, on average; 32.6% had fewer than 100 full-time employees; 32.0% had between 100 and 299; 18.2% had between 300 and 999; and 16.9% had 1,000 or more full-time employees.

Now that companies are rushing to review their seniority-based wage system, more and larger-scale fact-finding surveys such as this particular survey will be needed.

US$=\104 (April 2004)