Bank of Japan Governor Kazuo Ueda told the Federal Reserve’s Jackson Hole symposium that a shrinking working-age population is now producing “acute labour shortages” in Japan, pushing wages higher and prompting companies to invest in labour-saving technology. He said wage increases that once centred on large corporations are spreading to small and mid-sized firms and are likely to persist unless the economy is hit by a major negative demand shock. Ueda noted that recent gains in labour-force participation—particularly among older workers—have blunted some demographic headwinds, but he cautioned that the trend may fade. Bringing more women into full-time employment and admitting additional foreign workers could help ease the squeeze, he said, while rising job-switching among younger employees is intensifying competition for talent. The governor added that the BOJ will "continue to monitor these developments closely and incorporate our assessment of evolving supply-side conditions into the conduct of monetary policy." His remarks reinforced market expectations that sustained wage growth could pave the way for further interest-rate increases after the central bank ended negative rates and lifted its policy rate to 0.5% earlier this year.