Germany’s Creditreform registered 11,000 corporate insolvencies in the first half of 2024. This is an increase of almost 30 percent compared to the same period last year (8,470 cases) and marks the highest level for almost ten years.
The number of consumer insolvencies has also risen again.
The weak economic development and the persistently high burdens have caused insolvency figures in Germany to rise further. “Insolvencies in Germany have reached their highest level for almost ten years. In the first half of 2024, companies are continuing to battle against the effects of the recession in 2023, ongoing crises and the weak economic development this year,” says Patrik-Ludwig Hantzsch, Head of Creditreform Economic Research. “Taken together, all of this is breaking the back of many companies.”
High inflation, interest rates
The insolvency figures for consumers also rose. At 35,400 consumer insolvencies, 6.7 percent more cases were registered than in the same period last year (33,180 cases).In addition to inflation and the turnaround in interest rates, the amendment to consumer insolvency law at the end of 2020, which enables private individuals to discharge residual debt more quickly and thus makes the process more interesting for debtors, is likely to be responsible for the current increase.
The Creditreform Economic Research study also shows an increase in bad debt losses and the number of employees affected in the first half of 2024. This is due to the significant increase in the number of insolvencies among medium-sized and large companies.The number of cases among large companies (more than 250 employees) has doubled compared to the previous year.
Prominent major insolvencies in recent months were GALERIA Karstadt Kaufhof and FTI-Touristik. “We can see that it is not the sheer number of insolvencies that is decisive. The impact of a company going bankrupt is significantly greater than, for example, during the global financial crisis in 2009,” explains the Creditreform spokesperson.
In the first half of 2024, an estimated 133,000 employees were affected by insolvency (previous year: 125,000). “The focus of insolvency law on restructuring and preserving companies and jobs is primarily aimed at larger companies, which could explain the increase in the number of cases in this segment in recent years,” explains Hantzsch.
You will not have anything but will be happy (and depend on public subsides for unemployed, which will suffices just for surviving, while the world will be ruled by a few extremely rich owing 99% of all).
🙂
German Green Raw Deal: First collapse the economy, then increase control followed by an invented emergency: Drehbuch England.
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GALERIA Karstadt Kaufhof
It is hard to tell what is happening with this company. What happens when a particular store closes? Did the company own the building or lease? Is that building now empty? Are the employees out on the street, relocated, or getting unemployment compensation?
I suppose these questions have answers — a quick search isn’t much help.