Insolvent despite success? Structural crisis or comeback for SMEs? Germany at an economic crossroads – Image: Xpert.Digital
System change in the rope pull pattern: Germany's rescue plan for the economy
The German economic crisis 2025: between bankruptcy wave and investment hope
The German economy is currently experiencing one of the most difficult phases since the post -war period. What started as a economic weakness has now developed into a profound structural crisis that shakes the country's economic foundation. Despite the investment summit in the Chancellery and the announcement of billions of investments by the “Made for Germany” initiative, the bare numbers speak a clear language: Germany is in an unprecedented stagnation.
Bureaucracy, energy costs and tariffs kill companies as well as bad management. But some bankruptcies have their own stories
Suitable for:
The dramatic figures of the insolvement wave
The scale of the current corporate crisis is starkly revealed by insolvency statistics. 22,400 companies filed for insolvency in 2024 – the highest number since 2015. This represents a dramatic increase of 24.3 percent over the previous year. Particularly alarming is the doubling of creditors' claims from €32.4 billion in 2023 to €64.9 billion.
Experts predict a further worsening of the situation in 2025. The German Economic Institute expects approximately 25,800 insolvencies – a further increase of 15 percent. This could mean that Germany could soon reach insolvency figures close to the peaks of the 2009/2010 financial crisis, when over 32,000 companies filed for insolvency.
This development affects not only individual industries, but extends across all sectors of the economy. Transport and warehousing are particularly hard hit, with 11.3 insolvencies per 10,000 companies, followed by the construction and hospitality industries with 9.8 cases each. An upward trend can also be observed in consumer insolvencies: 72,100 new proceedings were registered in 2024 – an increase of 8.5 percent.
Suitable for:
The silence dying of medium -sized businesses
While insolvency statistics already paint an alarming picture, an even more threatening development lies behind them: the silent demise of Germany's small and medium-sized businesses. Around 196,000 companies closed permanently in 2024 – an increase of 16 percent over the previous year. Nine out of ten business closures are not due to excessive indebtedness, but rather due to a lack of prospects.
Figures from the KfW SME Panel reveal the full extent of the crisis: 231,000 entrepreneurs are already planning to close their businesses by 2025 – 67,500 more than in the previous year. In the medium term, within three to five years, another 310,000 entrepreneurs are considering closure. The main reason is often the age of the owners: the average age is 54, and 39 percent of entrepreneurs are even 60 or older.
This demographic time bomb meets a dramatic lack of successor. At the moment there are less than half as many takeover as followers. The result: decades of know-how and economic substance are irretrievably lost.
The multi -layered causes of the crisis
Contrary to public perception, the much -discussed energy costs are not the main drivers of the crisis. A comprehensive study by DSW and Advyce & Company shows that energy costs only make up four percent of the transformation pressure. The real problems are deeper:
Wage and structure costs
form the greatest crisis factor with 31 percent. The producer prices for commercial products have increased by 40 percent since 2020, while German export prices only increased by 20 percent in the same period. German companies are less and less competitive internationally.
Regulator and bureaucracy follows 24 percent as the second largest stress factor. Companies despair of endless applications, unclear requirements and a regulatory thicket that suffocates innovation and growth. DIHK chief feralyst Volker Treier rightly demands: “Down with the bureaucracy!”.
Increased international competition (21 percent) and the shortage of skilled workers (20 percent) round out the range of problems. The shortage of skilled workers, in particular, has reached a historic record: 86 percent of German companies are fighting for talent—more than double the number from 2014.
Three years of stagnation – Germany at a standstill
The economic reality is sobering: Germany is without any significant economic development before the third year in a row. For 2025, experts expect stagnation with 0.0 to 0.4 percent growth at best. The employer -related institute of the German economy even predicts only 0.1 percent growth after two years of recession.
The Bundesbank no longer expects growth for 2025 and has reduced its forecast from originally 0.2 percent to zero percent. The EU Commission also predicts stagnation for Germany after predicting an increase of 0.7 percent in autumn.
The location of the industry is particularly dramatic. This is deep in the recession and is dramatically badly utilized. The investment crisis continues unabated: the failures in gross investment investments have been around 210 billion euros since the beginning of 2020. Four out of ten companies want to invest 2025 fewer.
Suitable for:
The bright spot: “Made for Germany” Initiative
In the middle of these dark forecasts, the investment summit in the Chancellery ensured a glimmer of hope. 61 leading companies have come together in the “Made for Germany” initiative and announced investments of 631 billion euros by 2028. A three -digit billion -dollar amount of this is eliminated by new investments.
Participating companies include German groups such as BMW, Mercedes-Benz, Siemens, SAP and Deutsche Bank as well as international investors such as Nvidia, Blackrock and Blackstone. The initiative was launched by Christian Sewing (Deutsche Bank), Roland Busch (Siemens), Mathias Döpfner (Axel Springer) and Alexander Geiser (FGS Global).
Chancellor Friedrich Merz
was optimistic: "Germany is back, it is worth investing in Germany again." He spoke of one of the greatest investment initiatives that Germany has seen in recent decades.
However, companies are linking their investment commitments to structural reforms: less regulation, more freedom for companies, and more room for innovation. Siemens CEO Busch put it this way: "Germany needs a new operating system – geared toward growth, technology, and competitiveness."
Suitable for:
Structural challenges require structural answers
The current crisis is more than just an economic downturn—it's the result of structural problems that have been dragging on for years. Michael Grömling of the German Economic Institute puts it succinctly: "This has long since ceased to be an economic downturn, but rather a serious structural crisis."
The challenges are complex: the geopolitical turnaround with trade conflicts and tariffs, the decarbonization of the economy, demographic change and an overwhelming bureaucracy stress. These factors overlap and strengthen each other.
Demographic change in particular acts as a silent but powerful force. In the next few years, there will be strong birth vintages in retirement, while at the same time there are weak birth year. The shortage of skilled workers will continue to worsen, even if the current economic weakness is currently dampening it a little.
Suitable for:
The way out of the crisis
In order to find out from the crisis, courageous structural reforms are required. The Federal Government's 500-billion euro assets for infrastructure and climate protection is a first step. But more is needed: a corporate tax reform, incentives to expand the work volume, massive investments in infrastructure and defense as well as the serious degradation of unnecessary bureaucracy.
The new CDU/CSU SPD coalition has committed itself to these tasks. Whether she has the courage to break with old properties and enforce the necessary reforms will decide whether Germany finds the connection to the international top or remains in stagnation.
The "Made for Germany" initiative demonstrates that business confidence in Germany as a business location remains. Now, politicians must deliver. Time is running out – because while these discussions are ongoing, dozens of companies are closing their doors forever every day. Germany is at a crossroads between decline and a new beginning.
Suitable for:
- The economic crisis of suppliers using the example of the automotive industry: An analysis of the causes and global influences - a short version
- Würth in crisis mode: Analysis of the 40 percent drop in profits 2024/2025
- Bureaucracy in the EU: Germany in midfield-a comprehensive analysis for entrepreneurs, start-ups and scale-ups
Your global marketing and business development partner
☑️ Our business language is English or German
☑️ NEW: Correspondence in your national language!
Konrad Wolfenstein
I would be happy to serve you and my team as a personal advisor.
You can contact me by filling out the contact form or simply call me on +49 89 89 674 804 (Munich) . My email address is: wolfenstein ∂ xpert.digital
I'm looking forward to our joint project.
