The population has shrunk to less than a tenth of its peak, services are vanishing and white elephant public works projects have left the greying inhabitants with a mountain of debt. Welcome to Yubari, Japan in miniature.

This once-booming coal town built its wealth supplying the fuel that powered Japan's economic miracle of the 1960s and 70s.

But the switch to oil, followed by the stalling of the national economy as the asset and stock bubbles burst left public finances floundering. Jobs dried up and people started moving away.

Undeterred, the local authorities kept up the lavish public spending that is the hallmark of Japanese bureaucrats, hoping the economy would pick up if they threw enough money at it.

The city built a sprawling amusement park and bought an unprofitable hotel, both of which consistently failed to attract enough tourists.

Then in 2007, things finally snapped and Yubari was declared bankrupt, with debts of 63.2 billion yen ($805 million) -- almost $80,000 per inhabitant.

Salaries for some public sector employees were slashed almost in half sending many scurrying for the exits and leaving a much-depleted and very demoralised workforce trying to make ever-shrinking ends meet.

What was once a town of nearly 117,000 people now has a population of just 10,400, spread out over 763 square kilometres (305 square miles).