By Leika Kihara
TOKYO, Jan 13 (Reuters) – Japan’s bankruptcy cases last year climbed to levels unseen in 12 years as rising raw material costs and intensifying labour shortages took a toll on businesses, a private think tank survey showed on Tuesday.
The data highlights how inflation and a tight job market are emerging as fresh challenges for companies, which could keep the Bank of Japan under pressure to raise still-low interest rates.
The total number of companies that went under in 2025 stood at 10,300, marking the highest level since 2013. The number was up 2.9% from the previous year, marking the fourth straight annual increase but slowing from a 15.1% rise in 2024, according to a survey by Tokyo Shoko Research.
“As prices continue to rise due to the weak yen, companies that are slow in removing excess debt could come under new challenges such as rising interest rates, Trump tariffs and (Japan’s) souring relations with China,” it said.
The number of bankruptcies caused by labour shortages rose to a record 397 last year, the survey said.
A separate government survey published on Tuesday showed sentiment among firms close to consumers, such as retailers, worsened for the second straight month in December.
The index measuring sentiment among such firms slipped to 48.6 in December, down 0.1 point from November, according to the survey released by the Cabinet Office.
Some retailers said the rising cost of living was weighing on consumption, while a tourist agency in western Japan said there was no sign of a rebound in tourists from China, whose numbers have been falling, and that could drag on its business, the Cabinet Office survey showed.
(Reporting by Leika Kihara; Editing by Susan Fenton)
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