Japan bankruptcies surge in 2023, topping 8,000

Increases in labor costs due to workforce shortages particularly in the construction industry, and surges in the price of raw materials and energy dealt a blow to companies

Poor companies forced to raise wages. If that is such a severe blow in the supposedly 'free market ' of labor maybe they should not be in business.

The wages of New Capitalism.

Sure, blame their inept business style all on workers getting a few yen more a month as the reason for the flood of bankruptcies. I feel there is no way the BOJ can ever lift the interest rates in Japan or we will see such a tsunami of bankruptcies as companies are so reliant on cheap and easy money. But if they do rise, boom so many zombie companies will be forced to shutter. Which isn't a bad thing, but will hurt the workers who worked there.

Increases in labor costs due to workforce shortages particularly in the construction industry, and surges in the price of raw materials and energy dealt a blow to companies,

Some of them already use cheap labor, sometimes even go to extremes ask them to do overtime without really pay them.

https://www.japantimes.co.jp/japan/2023/08/16/illegal-practices-found-at-7247-firms-employing-foreign-trainees/

https://english.kyodonews.net/news/2022/11/c21d735d36a9-vietnamese-trainees-call-out-unpaid-illegal-overtime-at-japan-firm.html

Just like in US, private sector companies struggling post covid high inflation and a changed consumer.

No surprise Japan's Govt. spending money like crazy, like US, as real private sector economy shrinking fast.

People paying More to Get Less - not happy growth folks!

Japan continues its race to the bottom. I see it slipped to 4th in GDP rankings the other day, and will soon slip to 5th once Taiwan overtakes it.

And the stock market ended the year in record territory. The gap between the "haves" and "have nots" is growing.

Increases in labor costs due to workforce shortages

I didn't even know wages had gone up. In the US you have real and obvious wage increases of 20% or more.

Better to let the inefficient and bloated companies fail.

The culture of middle men all skimming their cut reduces the income for the producer and increases the cost for the consumer.

Let the more efficient and dynamic companies full the gap and grow. Only those that do away with their closed business practices protecting a series of middle men will succeed in today's modern markets.

Japan needs a shakeup. The old way of doing things needs to change.

Maybe if they stopped giving money to Ukraine and instead gave them to small businesses. Just a thought. Thanks for coming to my ted talk!

Abenomics and Kishida's New Capitalism front and center.

This has nothing to do with labor cost. Material cost have sky rocketed because these companies import materials and equipment and those costs have increase exponentially due to the weak yen. Govt policy at work.

Yubaru - And the stock market ended the year in record territory. The gap between the "haves" and "have nots" is growing.

Totally agree! Japan is going back to as it was 200 years ago. There is a ruling class and then there are the minions. The middle class is disappearing in Japan. No wage growth for over twenty years, 60% of the workforce on low paying short-term or part time contracts, an ever-increasing cost of living nd a shortage of labor all add up to increased poverty for the masses. Meanwhile, large corporations get huge tax breaks o fill their coffers. TIJ!

Japan is run by vested interests which are dominated by old men.

We can see this influence in the country by the lack of change and opportunities for the younger population strata.

LOL at the above comments.

First read the article more closely. "The number of corporate bankruptcies in Japan surged in 2023, topping 8,000 for the first time in four years," Which means the rate has been really low over the pass three years

In fact, the bankruptcies rate in Japan hit a record low in 2021,

Japan corporate bankruptcies hit 57-year low in 2021

https://japannews.yomiuri.co.jp/business/economy/20220114-9820/

So what happen? Russia and Ukraine? Which drove the price of oil and raw material higher.

Second, if you look at the numbers , the avg # of bankruptcies over the past 20 years is around 8k. So the number is returning to avg.

Third, bankruptcies has been soaring all over the developed world.

Bankruptcies in the US up by over 50 percent in 2023

https://www.cbs.nl/en-gb/news/2024/02/bankruptcies-up-by-over-50-percent-in-2023#:~:text=3%2C271%20companies%20declared%20bankrupt%20in%202023

Stick to the weather song.

Yubaru - And the stock market ended the year in record territory. The gap between the "haves" and "have nots" is growing.

LOL, Japan has the narrowest wealth gap in the G7

Japan continues its race to the bottom.

and you continue to live in Japan. What does that say about your country?

It's Orwellian really.

The masses struggling while the very small percentage at the top rake it in!

Terrible really.

The global economic boom was making nation state regimes look obsolete. So they are taking back control by crashing the economy. They can block any political pushback by starting an open-ended war and fully embrace Orwell.

In 1980,Japan had the second largest GDP.

However, in 2020 it was down to fourth place.

The most awful concern is that it will continue to plunge….

@ Bruce p, why should the government bail out poorly run, old imcompitant companies? .I've seen it countless times stacks if staff walking around doing nothing shuffling paper trying to look busy, staff sitting around because the boss hasn't gone home, business need to be efficient, and a lot are not,

And yet J225 achieves its all time high and MSCI Japan SMID Cap Index is rising. A recipe for disaster.

Sorry, J225 at 20 year ATH. ;)

@Brian Wheway this allows the workers of these companies to continue to pay taxes, the government finds that it is easy to keep a failing business a float than to pay out unemployed benefits to individuals. The government is in business to keep the people employed so that they can continue to tax you to death. The government is the only BUSINESS that has no business but claim the people as their business they are involved in everyone else business they are nothing more than gangster that can make your life miserable if you don't pay your taxes. Think about it what product does the government produce? Their business is a service created by them based on its citizens needs

why should the government bail out poorly run, old imcompitant companies? .I've seen it countless times stacks if staff walking around doing nothing shuffling paper trying to look busy, staff sitting around because the boss hasn't gone home, business need to be efficient, and a lot are not,