10,006 Japanese firms go bankrupt in 2024

Rising prices, worsening labor shortages and depreciation of yen in Japan resulted in its business failures leading to 10,006 firms going bankrupt in 2024, crossing the 10,000 mark for the first time in 11 years, economic experts said on Friday.

The yen depreciated by 10 percent in 2024, incurring widespread increases in both commodity and labor costs, placing a heavy burden on businesses.

Tsuruta Daisuke, Associate Professor of Economics at Nihon University, said that the companies unable to cope with soaring prices and rising labor costs had to shut down, while the aging population posed long-term challenges.

"A short-term factor is the rising prices. As the yen has depreciated, prices and labor costs are on the rise, companies unable to cope with these problems have to shut down. In terms of long-term factors, Japan is experiencing the impact of the aging population. In Japan, owners of small and medium-sized businesses are mostly aged over 60 years old on average, and the most common age group is even over 70 years old. Arguably aging could also lead to bankruptcy," he said.

Sakata Yoshihiro, manager of the information headquarters of Tokyo Shoko Research, noted that the business environment for smaller firms was particularly harsh last year.

"To some extent, large enterprises are able to transfer the costs to their sale prices, while it is hard for smaller firms to do so. They have to shoulder the cost increases on their own, which further weakens their resistance to risks," he said.

As Japan's businesses grappled with severe challenges in 2024, Sakata predicted that the trend of rising bankruptcies will continue in 2025.

"High prices will sustain, and the trend of manpower shortage and rising labor costs also goes on. So the costs are likely to go up further as compared with 2024. The most typical example is the catering industry. Due to the depreciation of the yen, prices of ingredients have been on the rise, plus the rising costs of energy and other things, and, there is a shortage of manpower that even with higher hourly payment, it is still hard to attract enough labor. So there is the double strike of high prices and labor shortage," Sakata said.

10,006 Japanese firms go bankrupt in 2024

Iranian Parliament Speaker Mohammad Baqer Qalibaf warned on Sunday that Tehran would view the United States and Israel's military bases and facilities in the Middle East as "legitimate targets" should Washington take military action against Iran.

At a parliamentary session convened to review an emergency proposal on assembly regulations, Qalibaf emphasized that, at this highly sensitive juncture, Iran must accurately and thoroughly identify the schemes of its adversaries.

Qalibaf said that Iran is currently confronting Israel and the United States simultaneously on four fronts: economic, cognitive, military, and counterterrorism. Of them, the economic warfare and the cognitive and psychological warfare began many years ago and have persisted to this day, growing increasingly complex and intense in recent years.

The remarks came as U.S. President Donald Trump is reportedly "seriously considering authorizing a strike" against Iran, taking advantage of its nationwide unrest.

Protests have erupted in several Iranian cities since late December over the sharp fall of the rial and long-standing economic hardship. Iranian authorities have acknowledged the demonstrations and voiced willingness to address economic grievances, while warning against violence and vandalism.

Amid the ongoing protests, deadly clashes have been reported lately between police and what the government described as "rioters." However, no official death toll has been released.

Also on Sunday, Iran's semi-official Tasnim news agency reported that Iranian President Masoud Pezeshkian will address the country's economic situation and political environment in a televised interview later that day.

Iran swears to counterattack if attacked