Japan's SMEs could be election losers as parties vow wage hikes

FILE PHOTO: A businessman waits to cross a street in Tokyo April 4, 2011. REUTERS/Yuriko Nakao/File Photo

TOKYO (Reuters) -Japan's political parties are promising to raise the minimum wage, a step that may win votes in Sunday's general election but could squeeze the small and midsize firms that form the backbone of the world's fourth-largest economy.

The wage-hike pledges particularly threaten small businesses, which account for two-thirds of jobs and over half of economic output, as they are already struggling to manage rising costs.