catch-up effect after crises
Significantly more corporate bankruptcies in Germany
08/11/2023 10:28 am
In the crises of the last two years, the state has given many companies massive support. They can survive like this. However, many of them are belatedly giving up, and the number of insolvencies is increasing significantly. The current economy is doing the rest.
The number of corporate insolvencies in Germany increased significantly in July. Almost a quarter (23.8 percent) more companies filed for standard insolvency proceedings in the month than in the same month last year, as reported by the Federal Statistical Office in Wiesbaden. There had already been an increase of 13.9 percent in June.
The number of corporate insolvencies has been increasing continuously since August 2022. The proceedings are included in the statistics only after the first decision of the insolvency court. Therefore, the actual time of the insolvency application is in many cases around three months earlier, the authority explained.
The final figures for May are now available: In that month, the German district courts reported 1,478 corporate insolvencies, 19 percent more than in the same month last year. The local courts put the claims of the creditors at almost 4 billion euros. In May 2022 it was almost 2.2 billion euros.
Logistics and transport badly affected
Based on 10,000 companies, there were a total of 4.4 insolvencies in May. Most insolvencies per 10,000 companies were in the transport and warehousing sector with 8.7 cases, followed by other economic services, such as temporary employment agencies, with 7.4 cases. There were fewer insolvencies in the energy supply sector. In addition, 5,679 consumer bankruptcies were reported in May, 3.7 percent fewer than a year earlier.
In recent years, state aid and the partially suspended obligation to file for insolvency have kept the number of company bankruptcies at a low level – despite the corona and energy crises. Experts had therefore expected an increase in the current year.
Germany’s economy shrank in late 2022 and early 2023 and only stagnated in the spring. Many experts also expect a decline in gross domestic product for the current year as a whole.