Japan bonus gap widens between large firms and SMEs

A widening gap in bonus payments between large corporations and small-to-medium enterprises (SMEs) is becoming a significant issue in the Japanese labor market. According to data from Keidanren, the average summer bonus for large companies exceeded 1 million yen for the first time in 2026. In contrast, statistics from the National Tax Agency and Furutsu-do Accounting highlight a stark disparity: employees at large firms with over 5,000 staff see average bonuses around 1.58 million yen, while those at businesses with fewer than 10 employees average significantly less, with some reports citing median values near 267,000 yen.

This wage gap is driven by different compensation structures and the ability of large firms to raise wages to combat labor shortages. While large companies show consistent pay raises across most age groups, SMEs struggle with stagnant wages for middle-aged workers as they prioritize younger staff to remain competitive. Experts suggest that SMEs may need to focus on non-monetary benefits, such as improved training programs and better work environments, to attract and retain talent in an increasingly difficult recruitment landscape.