"After Being Promoted to Director-General, My Salary Dropped by Over 10 Million Won"...Japanese Workers Shun Promotion

With Overtime Pay, Young Bureaucrats Surpass Their Supervisors in Salary
"Employment Ice Age Generation" in Their 40s and 50s Express Discontent... Reluctance to Seek Promotion Grows

The so-called "salary cliff" phenomenon, in which promotions in the Japanese central government bureaucracy actually lead to a decrease in annual salary, is spreading. Analysts note that the recent trend among Japanese companies of shunning managerial positions is now appearing within the bureaucracy as well.

On May 31, local media outlets including the Nihon Keizai Shimbun (Nikkei) reported that in Tokyo's Kasumigaseki district, home to many Japanese central government ministries, there have been repeated cases of annual salaries dropping after promotion to director or section chief. While overtime pay is fully provided to younger staff members, resulting in higher incomes for those working long hours, managers are excluded from overtime allowances and thus take home less pay after promotion.

Previously, it had been common practice in Japan's central bureaucracy to pay only a portion of the overtime worked—so-called "service overtime"—citing reasons such as budget constraints. This excessive overwork even earned the nickname "Black Kasumigaseki" for the area.

Tokyo Kasumigaseki, the area concentrated with Japanese central government ministries. Screenshot from the Ministry of Land, Infrastructure, Transport and Tourism of Japan website

The atmosphere began to change in 2021. At that time, then-Minister for Administrative Reform Taro Kono ordered that all overtime hours be recorded and full overtime pay be provided. As a result, working-level officials responsible for responding to the National Diet and reviewing policies late into the night have since received the full amount of overtime pay.

However, while conditions have improved for younger bureaucrats, an unusual situation has emerged in which subordinates now earn higher annual salaries than their superiors who lose their overtime allowances after promotion. A senior official at the Ministry of Internal Affairs and Communications told Nikkei, "After being promoted to director, my annual salary dropped by more than 1 million yen."

The Japanese government is also aware of the problem. The National Personnel Authority, which oversees civil servant appointments, expanded eligibility for the main ministry work coordination allowance to include managers as of April this year, providing a monthly payment of 51,800 yen. However, on the ground, many point out that this allowance alone is insufficient to make up for the lost income.

In particular, so-called "employment ice age generation" workers in their 40s and 50s have voiced their discontent. While their juniors are now benefiting from better conditions, they themselves had to endure long hours of unpaid overtime in their youth and are now excluded from allowances after promotion to managerial positions. As a result, with little reward for promotion and only increased work burden and responsibility, a tendency to avoid management roles is reportedly spreading throughout Japan.

Experts warn that this structure could accelerate the outflow of talent. As the responsibilities and workload that come with promotion in the bureaucracy now outweigh the compensation, a growing number of mid-level officials are considering moving to the private sector. In fact, wage increases in private companies continue, with this year's wage hike at major firms averaging 5.46%, topping 5% for the third consecutive year.

Nikkei noted, "If the perception that promotion is a disadvantage becomes entrenched, it could weaken the competitiveness of the bureaucratic organization," and called for work style reforms at the political level.

This content was produced with the assistance of AI translation services.