Japan Bankruptcies due to labor shortages: Updated October 24, 2024.

Record 163 firms went bankrupt in Japan in April-Sept. due to staff shortages

Article Source: https://mainichi.jp/english/articles/20241007/p2a/00m/0bu/022000c

Ideas:

The hiring landscape in Japan maybe has changed significantly, and maybe some workers are unwilling to take jobs that many would have years ago.

The so-called labor shortage in Japan is real and probably is not going to change anytime soon unless Japan can find a way to increase favorable immigration policies which can provide good jobs for foreigners and not just the low-wage trainee jobs being offered.

For Japanese workers, they see and know many companies are giving wage increases, not only to workers at the company, but also newly hired workers with substantial wages to attract the best talent they can get.

Small and medium size companies that can't afford to pay the wage increases that large companies can afford are losing out.

And as the article suggests sectors such as the construction industry might actually want to pay the higher wages, but these days, many young workers don't want to work in the construction industry.

The logistics industry companies might be suffering because of the need for long work hours, as again, young workers don't want to work the long hours, that maybe their fathers did some time ago.

Sometimes good intentions by a government can make it difficult for some sectors as the case with truck drivers and overtime restrictions. Maybe the answer is less restrictions for some industries which are having labor shortage problems.

Small businesses of course feel the full effects of the labor shortage as they don't have the resources needed to hire more workers or pay good enough wages to attract any new workers.

The Japanese government, for example, should put into place immigration policies which can help small and midsize companies hire foreign workers to help them stay in business, and maybe allow them to offer a little lower wage than the minimum wage as needed.

What the new Prime Minister says is good but it doesn't solve the situation for small companies that can't afford hefty wage increases.

Again, the Japanese government, if needed, if Japanese workers are not going to work for small companies, they need to have some good immigration policies that can bring in the type of workers needed for the small Japanese companies.

Wage increases are good and needed, but the reality is, many small and midsize companies can't afford to match the wage increases of large Japanese companies and that is the main problem, as young workers know this, so they don't want to work for a small company that when they can get a job at a large Japanese company with better wages.

What the article suggests is good, but some companies can't afford to wait to prove they can earn good profits and sales from their core business. The waiting time might be too much and they will then be in a position to possibly go bankrupt.

Yes, large companies, for the most part, are not the problem, its the small and midsize companies that can't afford wage hikes or even afford to hire new workers, or even give their existing workers a good wage increase.

Unless the Japanese government changes some of its labor or immigration policies, not much is going to change, as Japan needs foreign workers to come in and work in the small and midsize companies and then the small and midsize companies can get back to business as usual.

Have a nice day!