2024-09-11 02:35:37
The number of company bankruptcies in Germany fell slightly in August compared to the previous month. However, according to an economic institute, this could soon change again.
According to a study, the number of company bankruptcies in Germany fell slightly in August – but remains at a comparatively high level. The total number of bankruptcies of partnerships and corporations is 1,282, nine percent below the July figure, but 27 percent above the level of August 2023, as the Halle Institute for Economic Research (IWH) announced on Tuesday. There were particularly many bankruptcies in Baden-Württemberg, Bavaria and Saxony, where the highest values since the IWH insolvency trend began to be recorded in January 2016 were recorded.
“Based on our leading indicators, we expect a renewed increase in insolvencies in September and October,” said Steffen Müller, head of IWH insolvency research. The insolvency figures are therefore likely to remain significantly higher than before the corona pandemic.
With the German economy teetering on the brink of recession, many economists expect an increase in bankruptcies over the course of the year. The world’s largest credit insurer, Allianz Trade, predicts a 21 percent increase in bankruptcies in Germany in 2024, to around 21,500 cases. The increase is only likely to level off somewhat in 2025, with an increase of around two percent to 22,000 cases.
According to Allianz Trade, as the number of company bankruptcies increases, so do major insolvencies. There were already 40 of these in the first half of 2024. This is not only the highest half-year figure since 2015, but also more than a third more than in the same period last year. “At the moment, the rule is often: when it crashes, it crashes big,” said Milo Bogaerts, head of the credit insurer for Germany, Austria and Switzerland. “Major insolvencies often have a domino effect on many companies throughout the supply chain,” explained the manager.
There were many large bankruptcies, especially in the construction industry, fashion retail, service providers, and in the furniture and household goods sector, as Bogaerts explained. Hospitals also continued to struggle with many challenges. In the first half of the year, three hospitals were among the large bankruptcies.