Yen slump and labor woes spike Japan's record bankruptcies
In 2024, over 10,000 companies in Japan went bankrupt, including a record number of ramen restaurants. The reasons were labour shortages and rising import costs. The yen fell to its lowest level in 37 years, further exacerbating the situation.
In 2024, 10,006 enterprises in Japan declared bankruptcy, according to the Kyodo agency. The main causes were a deepening labour shortage and rising prices of imported goods. Ramen restaurants were particularly affected, with the number of closures reaching a record level.
According to Tokyo Shoko Research, the number of companies with debts of at least 10 million yen increased by 15.1% compared to the previous year. The value of the yen fell to its lowest level in 37 years against the dollar, which drove up import costs. Industries such as services and construction recorded the most bankruptcies.
A blow to the image of ramen
The Kyodo agency, citing data from the analytical firm Teikoku Databank, reported on Monday that last year 72 restaurants serving the popular ramen disappeared from Japanese towns, a 30% increase from the previous year.
The main reasons cited were rising employment costs and an increase of over 10% (in two years) in the price of the ingredients for this noodle soup.
Analysts note that to offset these changes, owners would have to raise the price to over 1,000 yen (approximately £6) per bowl, and "exceeding this threshold is seen as a blow to the image of ramen, which could deter customers".
Therefore, according to data from Teikoku Databank, almost 34% of restaurants last fiscal year absorbed the costs, resulting in a loss, and in 2025, due to reluctance to adjust menu prices, the number of closed restaurants may increase even further.
