The bankruptcy wave as a result of the pandemic has not materialized – at least so far. In the district courts, the number of cases has recently even decreased. Is that the calm before the storm?
The feared wave of company bankruptcies has not yet been reflected in the official statistics.
With 7408 cases, the number of corporate insolvencies in the first half of the current year was even 17.7 percent below the value in the first six months of 2020. According to the Federal Statistical Office on Friday, the level of the first half of the year, which was not influenced by the Corona crisis, was also increased 2019 fell 22.9 percent.
“It can be assumed that the state economic aid for companies and the obligation to file for insolvency, which will only apply again from May, contributed to the low insolvency figures in the first half of 2021,” said the Wiesbaden statisticians. In June, the number of company bankruptcies was 1197 cases, 11.6 percent below the level of the same month last year.
In order to prevent a wave of bankruptcies in the Corona crisis, the state temporarily suspended the obligation to file for bankruptcy when a reason for insolvency such as over-indebtedness or insolvency occurred. Since May 1st, the obligation to file for insolvency has been fully applicable again.
According to the Federal Office, the claims of creditors from corporate insolvencies in the first half of 2021, at 31.8 billion euros, were almost twice as high as a year earlier (16.7 billion euros). This is due to the fact that more economically important companies started going to the local court in the current year. The largest number of cases in the first six months were in construction (1,219) and in commerce (1,120).
The Leibniz Institute for Economic Research Halle (IWH), which publishes a monthly insolvency trend, assumes in its most recent publication for August that the number of insolvencies will continue to fall. Even in a long-term comparison, the numbers are “extremely low”, announced the IWH at the beginning of this week.
“Due to government support measures, the persistently low insolvency figures do not reflect the actual insolvency events,” explained IWH researcher Steffen Müller. “In order to avoid an ever-increasing backlog of bankruptcies, ongoing support measures should be quickly reviewed.” The short-time work allowance was important for the stabilization of the economy at the outbreak of the pandemic, but currently it is still “undifferentiated also paid for failed companies in industries that are not affected by the pandemic and are experiencing a boom,” said Müller.
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
