We examine the downward rigidity of nominal wage in Japan between 1993 and 2006 by constructing a quasi-panel data set of individual workers from the micro file of the Basic Survey on Wage Structure. The results are as follows: although the downward rigidity of the nominal hourly wage of fulltime regular workers is weak in Japan, it has increased since around 2000. The flexibility of the hourly wage comes from variation in scheduled hour worked. During economic downturns, many establishments reduce the hourly wage by increasing scheduled hours worked while keeping the amount of payment constant.
