Japan’s labor ministry has found itself in a precarious position over the past week — with a major data scandal exposing inaccurate economic projections and statistics at the government office.
The news first broke earlier this month, when it was found that the department’s Monthly Labor Survey had been overstating wage increases throughout 2018. Even prior to that, however, the labor ministry did not fulfill its obligation of surveying medium-to-large-scale businesses based in Tokyo between the years 2004 and 2017.
SponsoredOnce the data was corrected, the results showed a wage-growth drop by as much as 0.7 percent.
Too Good to Be True
Notably, Japanese Prime Minister Shinzo Abe’s main goals has been to increase wages for the general population. Since the country has been experiencing deflation for years, he pushed numerous economic policies to spur growth. With this data scandal, however, the effectiveness of Abe’s policies has come into question.
Higher wage representation unfairly affected the working class, which has prompted the government to adjust its GDP and alter its budget.
Two weeks after the initial discovery, a thorough investigation into Japan’s economic statistics has revealed that around 40 percent of them are inaccurate, in some way.
Furthermore, the corrected data show that the Japanese government owes its citizens a whopping 53.7 billion yen, or $490 million, in unpaid benefits.
SponsoredThe corrected data revealed lower wage growth, casting further doubt on the government's ability to meet its inflation goal.https://t.co/03Sm6f2CWX
— Nikkei Asia (@NikkeiAsia) January 26, 2019
Crypto to the Rescue?
In light of this data scandal, many are beginning to question whether cryptocurrencies such as Bitcoin (BTC) could be a better hedge for Japanese citizens. After all, the world’s largest digital currency (and a few others) are already considered to be legal tender in the region — thanks to a landmark law passed in April 2018.
While its Asian counterparts, namely China, have been far more reluctant to embrace cryptocurrencies, the Japanese government has welcomed it with open arms.
Interest regarding virtual currencies is also surging among the Japanese — which is not very surprising, given that the central bank can only offer rock-bottom interest rates due to the ongoing deflation problem. Citizens looking to protect their existing wealth are thus forced to engage in international trading or unconventional instruments.
It remains to be seen if the labor ministry’s missteps will encourage a surge of investment in cryptocurrency.
Do you think cryptocurrency will become a more commonly-used hedge against fiat currencies in Japan — and worldwide? Let us know your thoughts in the comments below!
