The gradual disconnection of state aid since autumn 2021 and the outbreak of the war in Ukraine have significantly clouded the economic prospects of a large number of companies. In Europe, most economists have downgraded growth figures for 2022 in the major eurozone countries. Rising energy, commodity and food prices have pushed the consumer price index to levels not seen in decades. The European Central Bank is expected to tighten monetary policy in a few weeks by raising rates after ending its Emergency Asset Purchase Program (PEPP, for Pandemic Emergency Purchase Program). As the war in Ukraine continues, more and more economists are raising the specter of a recession in the coming months.
In this particularly gloomy context, the number of bankruptcies jumped 49% in the second quarter after a previous 35% increase in the first quarter of 2022. According to the latest report unveiled by the Altares study on Monday 11 July, the number of bankruptcies thus increased from 6,587 in the second quarter of 2021 to 9,826 in the second quarter of 2022. For comparison, the total number of bankruptcies recorded in 2018 and 2029 was about 12,000 in the same period. The gap is narrowing with the pre-Covid level without returning to the levels of 2018 and 2019 over the same period. In total, jobs at risk amounted to 30,560, compared to 19,530 in the second quarter of 2021, an increase of 56%.
At that time, companies were still receiving numerous aid “at any cost” (solidarity funds, reduced working hours).
” Our corporate fabric resists but the curves we observe should prepare us to register between 35,000 and 40,000 defaults at the end of the year. Why the specter of recession level and companies will not be able to continue digging eternally in their cash pending the recovery of household consumption “, underlines Thierry Millon, director of Altares studies.
SMEs and start-ups pay a heavy price
In detail, small and medium-sized enterprises (SMEs) appear at the forefront with a spectacular 74% increase between the second quarter of 2021 and the second quarter of 2022 with 731 business terminations, compared to 420 the previous year. The number of bankruptcies of SMEs has thus returned to the pre-crisis level.
As regards the very small enterprises (TPE with fewer than three employees), the increase, certainly less significant, marks a clear acceleration (47%), passing from 5,012 to 7,365 at one-year intervals in the same period.
Among the other surprising results of this study is the percentage of young companies (the vast majority of which are micro-enterprises) that have gone out of business. Thus, companies less than 3 years old, that is, those that have registered for the most part since the beginning of the pandemic, recorded the greatest increase in bankruptcies (+ 135%), going from 743 to 1,750. . ” Sure, we create more companies, but we lose more, underline the Altares experts. The number of bankruptcies for these start-ups went from 743 to 1,750 between the second quarter of 2021 and the second quarter of 2022. By way of comparison, companies between three and five years (+ 53.8%), those between 6 and 10 years (33.2%) or finally those between 11 and 15 years (+ 32.9%) recorded much less marked increases
Finally, among the most affected sectors, catering (+ 110%), retail trade (+ 73%) and personal services (91%). In construction (+ 24%), in the manufacturing industry (+ 36%) or in business services (+ 41%), there is a recovery phenomenon.
Business creations are running out (-10% in the 1st half)
The war in Ukraine and the economic slowdown in the first half of the year undoubtedly held back a large number of business projects. After setting records over the past two years, the number of companies registered in commercial courts is running out.
According to the latest barometer of the commercial court registry presented on Monday 11 July, 303,870 companies were registered in the first half of the year, a decrease of 10% compared to the same period in 2022 (324,829). “The slowdown is even more marked for sole proprietorships, including micro-enterprises, which see the number of registrations drop by 28% in the semester, compared to the same period of the previous year “, emphasizes the institution.
“Precursors of a profound economic crisis”
At the same time, over 185,000 companies were canceled, with an increase of 35% compared to the same period compared to 2021 (131,412) according to employees. With growth slowing throughout 2022, many sectors could pay a heavy price in the coming months.
” If times do not yet have to run, the inversion of the curves of business creation and bankruptcies, associated with an acceleration of liquidations and delisting of companies, could be harbingers of a profound economic crisis ». Thomas Denfer, chairman of the National Council of Employees of Commercial Courts, explained in a press release.
#Businesses #bankruptcies #rise #quarter #approach #preCovid #level