Japan recorded more than 5,300 businesses going bankrupt in the first half of 2026 – the highest level in 12 years.
On July 8 (Tokyo time), according to Xinhua, the number of businesses going bankrupt in Japan in the first half of 2026 exceeded the 5,000-case mark for the first time in 12 years, reflecting the increasing pressure from inflation, the weakening yen and labor shortages.
According to a survey released by Tokyo Shoko Research, from January to the end of June 2026, Japan recorded 5,346 businesses going bankrupt with debts of 10 million yen or more (about 61,600 USD), an increase of 7.1% compared to the same period last year.
This is the first time since 2014 that the number of bankrupt businesses in the first half of the year has exceeded the 5,000 mark.
Tokyo Shoko Research said that the main reason comes from increased inflation in the context of the weakening yen, causing raw material and import costs to escalate, especially putting pressure on small and medium-sized enterprises.
In addition, the prolonged labor shortage also makes it difficult for many businesses to maintain operations.
Tokyo Shoko Research representative said that the number of bankrupt businesses may continue to increase rapidly from this fall if current pressures are not improved.
According to a survey, 90% of bankrupt businesses are businesses with fewer than 10 employees.
Meanwhile, nearly 80% of bankrupt businesses have total debts below 100 million yen (about 680,000 USD), showing that the small-scale business group is suffering the most severely.
Notably, the number of bankruptcies related to input costs increased sharply by 27.6%, to 439 cases compared to the same period last year.
Bankruptcy cases related to labor shortages also increased by 37.7%, to 237 cases.
The number of businesses that cannot maintain operations due to sharp increases in labor costs has increased 2.4 times, reaching 120 cases.
By sector of activity, the service sector recorded the most bankruptcies with 1,819 cases, an increase of 7.2% compared to the same period last year.
Second place is the construction industry with 1,026 businesses having to declare bankruptcy.
In June alone, Japan had 1,021 businesses going bankrupt, an increase of 20.4% compared to the same period last year.
This is also the first time in 25 months that the number of businesses going bankrupt in a month has exceeded the 1,000-case mark.
According to analysts, if inflation continues to remain high and the labor market does not improve, the bankruptcy wave in Japan may continue in the last months of the year.
