To begin with, let us consider the case of a CEO in Japan compared to the same position in the United States. According to a 2021 report by the Economic Policy Institute, the average CEO-to-worker pay ratio in the US is 320:1. This means that on average, a CEO in the US earns 320 times the salary of an average worker. In Japan, the ratio is much lower at 16:1, which means that a Japanese CEO earns 16 times the salary of an average worker. To put this into actual salary figures, the average CEO salary in Japan is around 35 million yen (about $310,000 USD) per year, while in the US it is around $12.7 million per year.
Even within the same industry, Japanese executives tend to earn
lower salaries than their Western counterparts. For example, let us consider
the automotive industry. In Japan, the CEO of Toyota, Akio Toyoda, earns an
annual salary of around 230 million yen (about $2.04 million USD) per year. In
comparison, the CEO of General Motors, Mary Barra, earned over $21 million in
2020. This is a significant difference and reflects the fact that Japanese
executives are not compensated at the same level as their Western counterparts.
It is worth noting that this difference in salaries is not
limited to CEOs. Even mid-level managers in Japan tend to earn less than their
Western counterparts. For example, according to data from the Japan Institute
for Labor Policy and Training, the average annual salary for a manager in Japan
is around 9.9 million yen (about $88,000 USD), while in the US it is around
$107,000 per year.
There are a number of reasons why Japanese executives earn lower
salaries than their Western counterparts As I mentioned in my previous article,
one key factor is the emphasis on teamwork and collective decision-making in
Japanese business culture. This means that there is less of a focus on
individual achievement, which can lead to lower individual salaries.
Additionally, the emphasis on job security in Japan means that employees are
often given long-term contracts and are less likely to be laid off, which can
also lead to lower salaries.
The salary examples provided above demonstrate that Japanese
executives tend to earn lower salaries compared to their Western counterparts.
This is reflective of the cultural and business practices of Japan, which
prioritize teamwork, job security, and non-monetary benefits over individual
achievement and high salaries. While this may seem surprising to some, it is
important to understand and appreciate the different cultural norms and
practices that exist in different parts of the world.
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