Japan Bankruptcies in May: Updated June 8, 2026

Japan bankruptcies in May down 8.9% from previous year.

Ideas

Banks in Japan, for the most part, have always been very human centric, meaning they don't just look at the bottom line but they look at the big picture, for the company and for society, compared to some or many banks in the US that just see the bottom and line and not the human side of business.

At the same time, unfortunately, in a market economy, there are always going to be those who can overcome difficult situations, and even with help, some are just not going to make it, as its just part of how a market economy works.

Not to be negative or downplay what happens, there might be a sizable number of Japanese companies that might be considered zombie companies, meaning they are just existing and not able to really do anything productive or doing anything to really help themselves.

Some or many companies, who are being adversely affected by soaring prices are probably small and mid-size companies and some of them could be suppliers to large companies and its quite possible that the large companies might be refusing the idea that small supplier type companies want to pass-on their increased costs to the next in their supply chain, which in this case involves the larger company.

And then there is the idea of companies with very thin profits margins just can't increase the wages that their employees want or need and can't increase wages to try and attract to news, and as result, unfortunately, some might choose to shut down or exit the market.

This is where Japanese banks can be even more human centric and find ways way to help the companies that deserve to be saved while understanding that not all companies should be saved as the market, for the most part, should also determine which companies survive and which need to exit the market.

A market economy is always going to have companies that enter a market and those that exist a market and those that are innovative then there are those, which just can't seem to make it no matter what they try.

Service type companies are usually the easiest to enter in a market but require a lot of time and sometimes the costs are just too high for many as in the case of restaurants, raw material costs might be out of control and restaurants can't keep increasing prices and they know they will loose many of their customers over time.

And then there is the ideas of labor costs, as again, as Japan is in a so-called labor shortage, it means workers in Japan, for the most part, have a choice and again means they can look for a company that can pay higher wages compared to those that can't.

As a result, those whose profit margins are just too thin can't afford to increase wages, probably due to increase in raw material costs, which means they have to keep wages low or they will not make a profit and it becomes very cyclical meaning a company just can't get past the constant high prices and the constant need to increase wages to keep employees.

Small and mid-size companies,, it seems are always the ones that go out of business as SMEs, and it is estimated make up 99 percent of all companies in Japans, so it not a surprise that some or many small companies have to exit the market.

Again, while Japanese banks are much more human centric than US banks there comes a time when maybe even the banks can't help some companies and those companies eventually need to exit the market.

Unfortunately, it must be remembered there is the human side of bankruptcies as families are being adversely affected and this is where a bank or other agencies can try to step in and provide assistance to the families being affected by the bankruptcies as sometimes it can be very devastating to those involved.

Have a nice day! 

Article source:  https://mainichi.jp/english/articles/20260608/p2g/00m/0bu/024000c