MNI BRIEF: German Insolvencies Stable, But Job Losses Grow
MNI (LONDON) - The number of jobs lost in Germany due to firms going bust rose by almost a third last month, the Leibniz Institute for Economic Research Halle (IWH) reported on Thursday, with business services and manufacturing suffering most.
Some 1,340 partnerships and corporations were declared insolvent in December 2024; almost the same number as in November. But more than 15,000 jobs were affected at the largest 10% of firms - around 30% higher than a month earlier, and 59% above the level seen in December 2023. Wuppertal-based automotive supplier WKW was worst affected, with more than 2,000 employees losing their jobs.
“Years of extremely low interest rates have prevented insolvencies, and during the pandemic, insolvencies were cancelled due to subsidies such as short-time work benefits. The rise in interest rates and the discontinuation of subsidies have triggered catch-up effects in insolvencies from 2022,” Head of IWH Insolvency Research Steffen Mueller said. (See MNI INTERVIEW: German Economy "Stuck," Top Economist Says)