Record High Corporate Insolvencies Shake Germany in 2025

Germany experienced a significant surge in corporate insolvencies throughout 2025, reaching the highest levels recorded since 2005. An analysis by the Leibniz Institute for Economic Research Halle (IWH) revealed that a total of 17,604 insolvencies were registered among both personal and capital companies in 2025, marking a sharp 75% increase compared to the average annual figures between 2016 and 2019.

December 2025 alone saw 1,519 reported insolvencies, representing a 17% rise from the previous month and a 14% increase compared to December 2024. These insolvencies affected over 170,000 jobs, with the manufacturing sector bearing the brunt, accounting for approximately 62,000 impacted positions.

Steffen Müller, head of IWH insolvency research, emphasized that this spike cannot be attributed to lingering effects of the COVID-19 pandemic. Instead, it reflects current economic challenges faced by businesses in Germany. Early indicators suggest that insolvency rates will remain elevated into the first quarter of 2026.

The IWH insolvency trend is considered a reliable early indicator, covering over 90% of jobs affected by such bankruptcies. The surge in insolvencies signals intensified economic headwinds, particularly in the manufacturing industry, highlighting pressing difficulties in the German business landscape as the country moves through 2026.