There were 83 bankruptcies caused by employee departures identified from January through July this year, 9 more than last year and the fifth consecutive year of increase. The outflow of core personnel is also occurring in succession as companies struggle to secure funds for wage increases.
The number of bankruptcies caused by employee departures identified from January through July this year reached 83, an increase of 9 cases from the same period a year earlier. The number of bankruptcies has increased for the fifth consecutive year. According to data compiled by Teikoku Databank, employee-departure bankruptcies are expected to set a new record high this year. As a result, employee departures have once again emerged as a risk factor for business continuity.
By industry, the services sector had the most cases, at 22, followed by construction, which reached the 20s for the first time during this period. Bankruptcies have been increasing in service fields such as nursing-care facilities for the elderly and hair salons.
As companies struggle to secure the funds needed for wage increases, they are unable to stem the outflow of key personnel responsible for the core of their operations, resulting in a succession of cases that trigger a chain of bankruptcies. The situation is attributed to the large number of companies unable to pass higher costs on through their prices.
Overall, the number of bankruptcies is expected to set a new high this year, exceeding previous levels, and some observers believe the risk of employee-departure bankruptcies will remain elevated.