Record-breaking company insolvencies reached Western Europe in 2023, marking the highest level since the year 2013. - Record-breaking bankruptcies surging in Western Europe since 2013's levels
Get ready for some grim economic news! According to the credit agency, Creditreform, we're facing the highest level of company bankruptcies in Western Europe since 2013. With a whopping 190,449 cases, that's a 12.2% steep increase over the previous year. And guess what? That figure is expected to go up even more.
Why's this happening? Well, three long years of economic stagnation and a downturn haven't spared even the almighty Germany. As Patrik-Ludwig Hantzsch, the head of Creditreform Economic Research, puts it, "Europe as a whole is bearing the brunt of weak economic development."
Chronic crises give businesses no time to catch a break
The surge in bankruptcies doesn't just stem from the Corona pandemic. Since 2021, when things were slightly better (112,686 company insolvencies), the number of business failures in Western Europe has skyrocketed by nearly 70%. And it's not just about one country – 15 out of 17 Western European countries considered in the analysis have seen an increase in insolvencies, year on year.
Leading the pack is France with a shocking 66,088 bankruptcies, a 17.4% jump over the previous year. Greece, Ireland, and the Netherlands have also seen significant increases due to new legal regulations, rising energy prices, weak demand, and geopolitical uncertainties.
In Germany, the story isn't much better: 22,070 companies went bust last year, marking a 22.5% upswing from 2023. Clearly, Germany has played a substantial role in driving the insolvency trend in Western Europe. The statistics published by the Federal Statistical Office differ slightly due to a different counting method.
However, there are some exceptions to this bleak trend. Denmark and the UK have reported fewer company bankruptcies, according to the Creditreform survey.
The construction industry and services sector are particularly hard-hit
In 2024, the construction industry faced a 15.4% increase in bankruptcies. Rising construction costs, high financing costs, and waning demand have increased the economic pressure on the sector. The service sector hasn't escaped this upheaval either, with a 14.2% surge in insolvencies.
- Western Europe
- Business failure
- Economic downturn
- Insolvency
- Germany
- Europe
- Chronic crisis
- Economic Conditions
- Supply Chain Disruptions
- Sector-Specific Challenges
- Financial Risks and Investment Failures
- Patrik-Ludwig Hantzsch
- Construction industry
- Service sector
[1] Northvolt AB, a key player in the green transition, faced financial difficulties despite significant funding.[3] Antolin, a company involved in mechanical components, had to face challenges due to increased capital expenditures.[5] The RTL Group reported challenges in the content production business, partly due to the US writers' and actors' strike and budget cuts by broadcasters.
- Despite various companies facing financial difficulties, such as Northvolt AB in the green transition and Antolin with increased capital expenditures, the number of business failures in Western Europe continues to rise, reaching the highest level since 2013.
- According to Patrik-Ludwig Hantzsch, the head of Creditreform Economic Research, the ongoing economic downturn in Europe is a significant factor contributing to the surge in company bankruptcies, affecting 15 out of 17 Western European countries.
- Industries particularly hard-hit by the economic conditions include the construction industry, which faced a 15.4% increase in bankruptcies in 2024, and the service sector, which saw a 14.2% surge in insolvencies.
