TOKYO – The restaurant industry is a leading victim of the coronavirus pandemic in Japan, according to data released yesterday by a private credit research firm, reported Jiji Press.
The cumulative number of business failures caused by Covid-19 is about 1,000, with the restaurant sector seeing 182 such cases, the largest figure by industry, said Tokyo Shoko Research Ltd.
It said an inn in Aichi prefecture, which suspended operations last February, was the first to go bankrupt in the country due to the pandemic.
After registering 104 such failures in June, the monthly bankruptcy figure dropped in July and August. The figure has hovered around 100 a month since September.
The slump in the restaurant industry has seen 46 wholesalers and 31 manufacturers go bankrupt.
Other industries offering face-to-face services have been hit hard as well, with the hotel sector seeing 62 business failures.
Labour Ministry data showed that the number of people in the restaurant industry who were retrenched or did not get their contracts renewed exceeds 10,000, second only to manufacturing.
The government has been trying to keep businesses afloat and maintain employment through special measures, such as effectively no-interest, collateral-free loans and employment adjustment subsidies.
“But there may be an increase in failures among mainly small businesses that run out of strength to remain viable, with no signs of business improvements in sight,” said a Tokyo Shoko Research official.
Many businesses are complaining that the central and local governments have failed to implement coronavirus countermeasures in an appropriate and timely manner.
“The subsidies (given to those who comply with requests for shortened hours) do not reflect the scale of the business, so we are in the red,” said an official at a major restaurant chain, criticising the same-amount relief given to all businesses.
“The Go to Travel scheme is suspended nationwide, but the government should resume it in prefectures,” said a senior member of the hotel industry.
“We don’t know how long travel demand will remain sluggish,” said an airline official.
A major department store official said: “Even if coronavirus cases decrease for the time being, we don’t know what will happen in the future.”
"With our loans ballooning, leading banks, in particular, are increasingly taking a stringent lending stance,” said a restaurant industry source.
“The situation is different from the state of emergency that was in place last spring.” – Bernama, February 3, 2021
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