MNI BRIEF: More German Firms Failing, Fewer Jobs Lost - IWH

The number of German companies declared bankrupt rose 12% to 1,588 in July, according to Halle Institute for Economic Research (IWH) data published Thursday, the second highest number in 20 years bar April 2025, although the number of jobs lost at the largest 10% of affected firms was down 39% on June's figure, to 10,000.

July's numbers were in part due to seasonal variations, with declarations by smaller firms showing up more quickly in official statistics than those by larger enterprises, IWH's Steffen Mueller said. Record highs were recorded in North Rhine-Westphalia, Baden-Württemberg, and Berlin, while declines were seen in eastern Germany.

Leading indicators, which predict closures by two to three months, suggest were up 8% across the board in July. "The level of the leading indicators is unusual and suggests high insolvency figures for the fall as well, although their impact on the labor market will be comparatively moderate," Mueller said.