Corporate bankruptcies in Japan involving liabilities of at least ¥10 million reached 887 in January, the highest in 13 years, according to Tokyo Shoko Research. The figure rose 5.5% from a year earlier, marking an increase for the second straight month.
Tokyo Shoko Research reported on Monday that the number of corporate bankruptcies in Japan in January, with liabilities of at least ¥10 million, totaled 887—the highest level in 13 years, last seen in January 2009. This marked a 5.5% rise from the previous year and continued an upward trend for the second consecutive month, primarily driven by failures due to sluggish sales.
Among the 10 industries surveyed, five experienced year-on-year increases, including services, retail, wholesale, and transportation. Bankruptcies linked to weak sales climbed 6.3% to 649 cases, representing the largest share of total failures. Those stemming from accumulated losses rose 18.3% to 116, while cases tied to high prices—where firms struggled to pass on rising costs—jumped 24.5% to 76.
"This suggests the impact of sluggish real wage growth on consumer behavior," said an official at Tokyo Shoko Research. Separately, bankruptcies attributed to rising labor costs surged to 19, nearly tripling from a year earlier, as more small and midsize companies raised wages to retain workers, straining their finances.
Total liabilities from failed firms fell 1.3% to ¥119.815 billion. No single failure exceeded ¥10 billion in liabilities, with midsize companies accounting for a significant portion of the total. These figures highlight ongoing pressures on Japan's smaller businesses amid economic challenges.