TOKYO (Reuters) - Major Japanese firms plan to use their excess cash next year on capital investments and M&As rather than higher salaries, according to a Reuters poll, showing few businesses plan to heed Prime Minister Shinzo Abe’s call for wage hikes.
Abe has been putting pressure on Japanese companies, which have benefited from easy money and a weaker yen, to raise wages in addition to capital expenditure with the aim of ending decades of deflation and stagnant growth.
Only seven of 36 respondents representing Japanese blue chip companies said they would spend money to raise full-time employees’ wages in 2016. None said they would raise wages for part-time workers. The survey was taken around the week of Dec. 21.
Telecommunications company NTT 9432.T, seasoning maker Ajinomoto Co Inc 2802.T and Asahi Kasei Corp 3407.T were among the 21 firms which said they would increase capital expenditure next year.
Game maker Nintendo Co Ltd 7974.T, along with electronics maker Panasonic Corp 6752.T, which recently announced to buy U.S. refrigeration firm Hussmann, said they would boost capital spending and investment on M&As.
The survey, taken the week of Dec. 21, also showed that an economic slowdown in China and emerging markets remained a top concern for companies.
Respondents forecast the Japanese yen to trade between 127.4 yen and 116.9 yen per U.S. dollar JPY=EBS. It traded at around 120.40 to the dollar on Monday.
Forecasts for the benchmark Nikkei share average .N225 ranged between 22,100 and 18,500, compared with its close on Monday around 18,873.
Reporting by Kaori Kaneko and Ritsuko Ando; Editing by Sam Holmes