A look at Japan's IT salaries. #2

A typical Japanese salary consists of a base salary (基本給), various allowances (手当), and annual bonuses (賞与). Base salary is your fixed monthly pay. Allowances can provide extra pay for housing, experience, transportation, and family support. Bonuses are performance-based and usually equal to 1-2 months' salary.  These allowances and bonuses significantly impact your total earnings.

📌 Japanese salaries are stated as gross annual amounts. Tax deductions include income tax, resident tax (which covers prefectural and municipal levies), and pension contributions. Health and employment insurance are additional costs. Japan operates a progressive tax system. To get a general idea of your net income, you can use a tax calculator found at this link.

📌 Opensalary is a popular resource for local developers looking to get a handle on average annual salaries. It's worth noting that salaries can fluctuate significantly based on a company's location and scale. Companies in Tokyo, especially FAANGs like Mercari, Rakuten, LINE, and Indeed, often offer higher compensation packages. As you move farther away from urban centers, salaries typically decrease. For example, junior developers in smaller cities might start at approximately ¥3,000,000 per year.

Up, down or flat? The state of salaries. Overall, tech salaries were on the rise in 2023. This was largely due to competition for in-demand roles and candidates’ increased expectations in line with the surge in living costs. More so than in the past, we have seen a number of offers rejected because companies were not flexible in understanding the market rates for compensation required to tempt candidates to accept offers. Those that have adjusted accordingly have reaped the benefits of attracting premier talent. 

Check out these 3 detailed guides on IT salaries in Japan, plus a job board and salary comparison tool:

• The 2024 Hays Asia Salary Guide

• The 2024 SALARY GUIDE (Robert Half)

• Morgan McKinley’s 2024 Salary Guide Japan Market Overview

• The job board from Hays

• Benchmark your salary (Robert Walters)

🔗 Sources cited in this article: Morgan McKinley’s 2024 Salary Guide Japan Market Overview, The 2024 Hays Asia Salary Guid, The 2024 SALARY GUIDE (Robert Half).

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