Companies in Japan are going out of business at a record pace and a leading electronics maker has announced further lay-offs to cut costs.
According to a survey by a private research agency, Teikoku Databank, the number of corporate bankruptcies in Japan jumped nearly 16 percent to more than 18-hundred in July from a year earlier. That is a record for the month of July since 1945, and shows the damage Japan's prolonged economic slump is doing across the country.
Liabilities left by insolvent companies in July hit $10 billion. Teikoku Databank forecasts that bankruptcies will remain at high levels.
Consumer sentiment continues to be weak. The Japan Department Stores Association reports that July sales at department stores in Tokyo dropped five-point-seven percent from the previous year. That marks the eighth straight month of declines. The figures are closely watched as a key indicator of Japanese consumer spending.
The association says July's sales slump was caused in part by two typhoons, which kept customers away from shops.
Shinji Kikuchi, an official with the Department Stores Association, spoke recently with TV Tokyo. He says sales will recover next month, along with the economy. However, he says the tough sales environment will continue, because of the fragile economy and low consumer demand.
Electronics giant Fujitsu has unveiled an additional restructuring plan. The company will slash 2,100 jobs at four factories, or about one percent of its global workforce. The move is a part of the company's strategy for coping with the worldwide slump in the information technology sector. Many Japanese electronics makers have cut thousands of jobs to return to profitability amid competition from other Asian rivals.