Germany records highest number of company insolvencies in 21 years

German corporate bankruptcies surged in the second quarter of 2026, reaching 4,996 cases – the highest level since 2005. The sharp rise was driven primarily by the hospitality, construction and trade sectors. In June alone, 1,702 firms filed for insolvency, affecting roughly 45,500 jobs.

At the same time, the German industrial labour market is shedding about 15,000 positions each month, amounting to around 174,000 jobs lost over the past year. Unemployment rose to 2.936 million, with the unemployment rate at 6.2 %. Weak demand, high energy and labour costs, disrupted trade flows and cautious investment are cited as the main causes. The combined pressure on firms and workers deepens concerns about Germany’s economic outlook.

Analysts note that while overall startup insolvencies remain low (117 in the first half of 2026), the broader corporate sector faces persistent structural challenges, including rising financing costs, higher wages and regulatory burdens, which together fuel the current wave of bankruptcies and job cuts.