It's really complicated. Basically salaries are quite low in comparison to many other countries. However, there is a "bonus" which is usually paid 3 or 4 times a year. Different companies have different schemes, but often the salary is based on position and the bonus is based on position and seniority. The overall compensation is lower than the US probably, but higher than many European companies. There are cost of living increases, but you don't generally get a raise without a change in position.

However, there are some other things that are important to realise. Generally the company looks after you for your entire life. When you retire, they will give you a lump sum retirement amount. I work for my own company in Japan and my accountant was very quick to point out the need for the company to save for my retirement. Additionally, you often get other "perks". For example, my wife's uncle lives in a house that used to be on land owned by the company he worked for. They sold him some land so he could build a house close to work. They even sold him some extra land so that he could have a garden (in a different location) -- and he made a tidy profit on that when we got too old to garden any more. This kind of thing (maybe not exactly, but similar) was expected before 1998. It's falling out of fashion these days, but for "permanent employees" (not on yearly contracts) it's still the norm.

The total compensation package is quite good in most companies, I think. Of course, there is a lot of competition to get into the best companies and once you are in, there is a sense that you've "made it". It's extremely difficult to get fired from a permanent position and companies will rather pay you a salary to do nothing rather than to fire you if things really don't work out. So, there is a lot of give and take. On the other hand, don't quit your job! Anybody who sees you were stupid enough to give up a permanent placement somewhere will not be interested in hiring you -- you'll be stuck on contract positions (and much less security) for your whole life.

One of the things that westerners have difficulty with when comparing their situation with the situation in Japan (and probably some other SE Asian countries like Korea, though I have no direct experience with that) is that the companies treat their workers completely differently. In the west, there is no loyalty to workers. In Japan, anyway, the company is completely responsible for their workers' well being. It even enters into what would be considered private matters in the west like if you are overweight the company will feel compelled to do something about it because in the long term it's bad. Even for things like being single -- the company usually doesn't like it and will help you find someone to marry if you are having trouble in that department. It's just such a totally different experience that you can't compare it.

On a personal note, I worked on contract for a school division in Japan and even though I was on contract, the school looked after me. I needed surgery and for some bureaucratic reason the hospital needed someone to co-sign a loan guarantee in case something went wrong. The school took care of it. The principal was also worried that at the time I was over 40 and not married and assigned the school nurse to lecture me about the dangers of not getting my personal life in order (and even arranged for me to attend some gokon -- parties where you meet people who are interested in getting married... though I explained to them that my girlfriend wouldn't like it if I went :-) ). My case is pretty weird for a foreigner on contract, but for whatever reason the school decided to treat me like an employee.

Anyway, I'm kind of droning on and you may not be interested in all of this. I'm sure a lot of it is really weird to you and you may be thinking, "I wouldn't want that!", but I guess the point is that it's really hard to compare the situations. It's just so different here for full time employees. For someone like me, it works well because I tend to bury myself in work (which I enjoy) and I need someone to look out for me. That's probably why the school decided to take on that role. I'm bad at negotiating contracts and I like it when the opposite side takes a moral position to look out for my interests. It would be almost impossible to negotiate as good a position as you might get in the west, but it's also really difficult to get into as bad a position (as long as you are a permanent employee with a reputable company). As time goes by, this situation has gone from expected for almost every worker, to only being common for professionals. It's slowly moving towards the same situation as in the west and I, for one, feel a lot is being lost along the way.

It's funny because since I own my own consulting company now, I insist that I treat myself well. However, the expense of that is actually quite high and you would not believe how low my salary is :-)