Hey everyone! Japan's small and micro firms are feeling the squeeze: labor shortages, rising costs, and what's being called "the Takaichi Fallout" are combining to push bankruptcies to a 12-year high. 😬
Japan saw 5,172 corporate bankruptcies in April-September this year—liabilities at least 10 million yen (~$64k)—up 1.5% from the same period in 2024, and the largest in 12 years, says Tokyo Shoko Research. This marks the fourth straight year of rising failures.
What's behind the crunch? Over 70% of these cases are firms with debts under 100 million yen—the highest share in 30 years. These are your local mom-and-pop shops, little startups, and family-run cafés—the backbone of Japan's economy—now hit hardest by higher wages, rent hikes, and staff shortages. 👩💼👨🍳
Labor shortages triggered a record 202 failures alone, with businesses citing soaring wages, hiring headaches, and sudden staff departures. It's like trying to run a warung in Jakarta or a sari-sari store in Manila when you can't find people to man the stalls!
Economists say the fallout highlights deeper structural challenges: an aging workforce, limited credit access for tiny players, and a need for fresh fiscal lifelines. Can Prime Minister Sanae Takaichi's policies turn the tide? For now, small biz owners are bracing for more turbulence.
For young entrepreneurs across South and Southeast Asia, it's a reminder of the importance of agile planning, diversified revenue streams, and digital innovation—think delivery apps, pop-up markets, and online side hustles—to stay afloat in choppy markets.
Stay tuned as we track whether "the Takaichi-cost" eases or whether we'll see more waves of small biz woes. 🌊💼
Reference(s):
'The Takaichi Fallout': Rising bankruptcies test Japan's economy
cgtn.com
