German corporate insolvencies remain 'exceptionally high' in October

Germany's corporate insolvencies rose slightly in October, according to figures released on Thursday by a leading German economic research institute.

The Halle Institute for Economic Research (IWH) recorded 1,683 company insolvencies during the month, up 1% from September and 9% from October last year.

Compared with the average of the month of October from 2016 to 2019 - before the coronavirus pandemic - the figure was 83% higher. "Insolvency figures continue to be at an exceptionally high level," said Steffen Müller, head of IWH insolvency research.

The number of jobs affected by major insolvencies also rose sharply. Among the largest 10% of insolvent companies, around 16,800 jobs were affected, an increase of 45% compared with September.

The IWH uses these figures as a rough guide to all jobs affected by company insolvencies. However, it does not say how many employees actually lose their jobs.

In manufacturing, around 9,400 jobs were affected. That was the second-highest figure since the IWH began its surveys in January 2020. Only in September 2024 was it higher.

Among the best-known insolvency proceedings opened in October were those of battery manufacturer Varta and several companies linked to it.

The IWH had expected falling insolvency numbers in the final quarter back in September. The institute monitors signals that are meant to indicate developments in the coming months. 

These leading indicators had recently fallen, the institute said, and usually lead insolvency trends by two to three months. It therefore expects fewer cases in November and December.

For its monthly figures, the IWH analyses reports from insolvency courts. Only companies entered in the commercial register are recorded. 

The IWH figures are therefore not directly comparable with other official insolvency statistics, which sometimes include additional cases and are usually published around two months later.