Government efforts
To help mitigate the economic damage The Small and Medium Enterprise Agency of Japan (under the Ministry of Economy, Trade and Industry) started the a program that helps businesses with succession. The program is called the Business Succession Support Fund (事業継続・引継ぎ補助金). There are two funds the Management Reform (innovation) (経営革新)と専門家活用) to help with M&A efforts.
It will be interesting to see how helpful the government support grants are. Some basic figures show that of the number of businesses that were continued on through M&A (including spinoffs) were 15.8% in 2019 and increased to 17.8% in 2021. Perhaps this can be attributed to the government program, but this data is uncertain.
In addition, there are other measures to increase the number of foreign workers in Japan as well. However, this is a whole other topic that has caused quite some trouble around labor conditions. Furthermore, experts still estimate that there will not be enough workers. According to research by JICA (Japan International Cooperation Agency), there will be a shortage of about 630,000 foreign workers in 2030.(source)
This is great to see the government trying to preserve these businesses and of course try to mitigate the economic damage, but nothing can stop the loss of people and everything that comes with it. It should be noted that no successor, includes not only someone to continue the business like a family succession or internal employee promotion, but also third-parties from the outside as well, such as M&A or a third-party outsider successor.
|