Key Facts
• In fiscal 2025, corporate bankruptcies reached 10,425, a 3.5% increase from the previous year.
• This marks the fourth consecutive year of year-on-year increases and the second consecutive year exceeding 10,000 cases.
• Total liabilities dropped 31.0% to approximately 1.55 trillion yen from 2.25 trillion yen the prior year.
• Bankruptcies with liabilities under 50 million yen hit a record high since 2000, highlighting small and micro enterprises.
• Five of seven industries saw increases; service and retail sectors reached highest levels since 2000.
• Construction and real estate bankruptcies were the highest in the past decade.
• Medical bankruptcies led service sector due to staff shortages and aging management.
• Retail bankruptcies rose, driven by inflation and rising labor costs, especially in restaurants.
• Eight of nine regions recorded highest bankruptcies in 10 years; Tohoku was the only region to decline by 4.7%.
• The Kanto region accounted for 33.8% of bankruptcies, increasing 1.6% year-on-year.
• Labor shortage-related bankruptcies hit a record 441 cases, surpassing 400 for the first time.
• Successor absence bankruptcies rose to 533, exceeding last year’s 507 after two years.
• Inflation-related bankruptcies totaled 963, a record high for the second consecutive year.
• Construction, retail, and manufacturing sectors were most affected by inflation-driven bankruptcies.
• Data covers April 2025 to March 2026; includes bankruptcies with liabilities over 10 million yen under legal procedures.
Summary
Corporate bankruptcies in Japan continued to rise in fiscal 2025, surpassing 10,000 cases for the second year in a row. The increase reflects ongoing pressures from inflation and labor shortages, which have severely impacted small and micro enterprises. While total liabilities decreased significantly, the number of bankruptcies among smaller companies reached record levels. Service and retail industries, particularly medical services and restaurants, faced the highest bankruptcy rates due to workforce shortages and rising costs. Regionally, most areas experienced their highest bankruptcy counts in a decade, with the Kanto region leading. Labor shortage-related bankruptcies and those caused by successor absence also increased, highlighting structural challenges in business continuity. Inflation-driven bankruptcies hit a new peak, especially in construction, retail, and manufacturing sectors. The data underscores the difficult environment for small businesses unable to pass rising costs onto customers, resulting in worsening cash flow and financial distress.
