According to the Leibniz Institute for Economic Research Halle (IWH), the number of company bankruptcies rose last year to its highest level in 20 years. In December alone, the number of bankruptcies increased significantly and was 75 percent above the level of an average December from 2016 to 2019, i.e. before the corona pandemic. In December, 1,519 bankruptcies were recorded.
In 2025 as a whole, the number of bankruptcies was 17,604. Even in the wake of the financial crisis in 2009, the number was around five percent lower, it was said.
The high number of insolvencies can no longer be explained by catch-up effects from the pandemic and interest rate policy, said Steffen Müller, head of IWH insolvency research. They “reflect more and more clearly the current economic challenges in Germany”. At the same time, insolvencies also represent a necessary market shakeout, which creates space for sustainable companies.
Many industries affected
“The increase was wide, no one was spared,” Müller told the German Press Agency. “The growth was particularly strong in the hotel and catering industry.” However, there were also many bankruptcies in the construction sector and among project developers. “The rise in interest rates at the end of 2022 put a damper on some people’s plans there.”
The number of major bankruptcies has also increased significantly. According to a survey by the transformation consultancy Falkensteg, 471 companies with annual sales of more than ten million euros filed for bankruptcy – an increase of around 25 percent compared to the previous year.
Metal goods manufacturers, automotive suppliers, electrical engineering companies and interior construction were particularly affected. Since 2021, major bankruptcies have almost tripled.
No trend reversal in 2026
“The German economy is no longer just struggling with a headache – it has developed a fever,” says Falkensteg partner Jonas Eckhardt. The causes are diverse, but their interaction is developing a disturbing dynamic. “For many medium-sized companies, this is no longer a downturn in the economy, but a question of survival.” The experts also see no trend reversal in sight for 2026.
Specialists who work on restructuring companies at banks also expect that many companies will continue to run into difficulties due to the economic crisis in Germany. They expect that the “restructuring cases” – i.e. the efforts to rescue companies from an existential crisis – will not reach their peak until 2026, as a study by the strategy consultancy EY-Parthenon shows. The automotive industry and retail are particularly affected. The industry remains under pressure due to reduced competitiveness, especially in comparison to Asia.