The average wage of 102 listed banks and insurers dropped 1.4% since 2016.
Bloomberg reports that Japan's ultra-low interest rate environment has weighed on not just industry bottomline but also the pockets of the industry's employees as research from Tokyo Shoko Research show that the average wage at 102 listed banks and insurance firms dropped by 1.4% since 2016.
Average wages in the construction industry are now 16% higher than the salaries of banking and insurance staff, according to the report, as the banking industry ranks amongst the worst performers of the ten sectors surveyed in the report. Average pay in the construction sector has increased 8.7% to $69,275 (JPY7.49m) since 2015 thanks to robust demand brought about by the impending Olympic Games.
As bankers struggle with lower salary packages, pay for all companies included in the survey rose 2.9% over the same period.
Despite growing calls to hike rates in response to weakening profitability, the central bank earlier pledged not to raise interest rates before spring 2020 in the first time it has marked a specific time period by which it intends to keep rates low, reports Nikkei Asian Review.
The profitability of the banking sector lags behind G7 peers with return on assets at around 0.4% in the first half of 2018, data from Moody's show. Megabanks are not exempted from the earnings decline as the annual profits of MUFG fell 12% YoY for the fourth straight year. Similarly, the earnings of Mizuho plunged 83% YoY to $877.22m (JPY96.6b) in the year through March 2019 to mark its weakest performance since 2008.
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