Fewer German Companies Worried about Their Survival
Fewer German companies feel their economic survival is threatened. The proportion fell to 4.8 percent in January from 6.3 percent in December, finds an ifo Institute survey. “The economic slowdown is thus unlikely to leave any major traces in the form of corporate insolvencies,” says Klaus Wohlrabe, Head of Surveys at ifo. In June 2020, the proportion of companies that considered themselves at risk was 21.8 percent, due to the coronavirus pandemic.
This decline can be observed across all sectors of the economy. However, the highest numbers are still in the retail sector, where 8.3 percent of companies said their survival was in jeopardy (December: 9.7 percent). “Many retailers are hurting from consumer restraint and high inflation,” Wohlrabe says.
Among service providers, the proportion fell from 6.4 percent to 5.2 percent. Concern is especially high in the hospitality and travel industry.
In manufacturing, 4.0 percent of companies consider their survival to be threatened (December: 6.5 percent). Many energy-intensive sectors, such as the chemical industry, continue to be concerned; the share there remains just above 10 percent.
Links
ifo Podcast: The ifo Business Climate – A Look behind the Scenes
Journal: ifo Konjunkturperspektiven
