The IWH insolvency trend registered 1519 insolvencies of partnerships and corporations in December - 17% more than in November, 14% more than in December 2024 and 75% above the average for a typical December before the pandemic (2016 to 2019).

Highest level of insolvencies for 20 years

"Closures of large employers often lead to significant and permanent losses of income and wages for the employees affected. The number of jobs affected by major insolvencies also provides a good approximation of the total number of jobs affected by insolvency," explains the IWH.

More than 15,000 jobs were affected in the top ten percent of insolvent companies in December. This is two thirds more than in the previous month, slightly less than in December 2024, but 70 percent more than the average in the pre-corona years.

For 2025 as a whole, the IWH reports 17,604 insolvencies - the highest level since 2005. Even during the financial crisis in 2009, the figure was around five percent lower. In total, around 170,000 jobs fell victim to insolvency.

The manufacturing industry was once again the hardest hit: Around 62,000 jobs were lost in this sector. The Federal Statistical Office does not publish detailed sector-specific statistics; the IWH has been collecting such data since 2020.

Are catch-up effects a reason for the high number of insolvencies?

Steffen Müller, head of IWH insolvency research, puts the figures into perspective:

"Extremely low interest rates and extensive state aid had initially prevented insolvencies for years. The rise in interest rates and the discontinuation of subsidies triggered catch-up effects from 2022. In the meantime, however, the catch-up effects are likely to have lost their force. The current high insolvency figures increasingly reflect the current economic challenges in Germany."

"However, insolvencies are also a normal part of the market economy: they represent necessary market adjustments and create space for sustainable companies."

The IWH researchers observe early indicators that run two to three months ahead of insolvency activity. These values have been rising continuously for months, which is why Müller also expects high insolvency figures for the first quarter of 2026.

Leading indicator for the economy

The IWH Insolvency Trend provides a reliable overview of insolvency activity in Germany faster than official statistics. It is based on the latest announcements from the registry courts, which are linked to the balance sheet data of the companies concerned. According to IWH, the trend covers over 90 percent of jobs affected by corporate insolvencies and 95 percent of claims - a reliable indicator of the economic consequences.

Official statistics, on the other hand, show provisional monthly figures for all regular insolvencies, which also include micro-enterprises, the self-employed and sole traders with private liability.

"Regular insolvencies are therefore not the same as corporate insolvencies. The number of insolvent partnerships and corporations accounts for less than half of regular insolvencies. The percentage monthly changes in regular insolvencies can differ significantly from those of partnerships and corporations due to the large number of insolvency cases that are insignificant for the economy as a whole," says the IWH.

All underlying data is available as an Excel download on the Institute's website.