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Bankruptcy Surge to 15-year high in 2025 as businesses struggle to cope president donald trumpof trade waramong other factors, according to a new report.
no less than 717 companies Bankruptcy filings under Chapter 7 or 11 between January and November, according to data reviewed by Standard & Poor’s washington post. That’s a 14% increase from the same period in 2024 and the highest level since the country’s recovery from the Great Recession in 2010.
Bankrupt companies point to inflation, interest rates and Trump’s trade policy – which hampered supply chains and increased costs – became a driver of their financial woes.
Business experts and economists tell postal republican president extensive tariffs Putting companies that rely on imports into trouble. While inflation has been lower than expected recently – up 2.7% year-on-year in November – experts say many companies continue to incur additional costs to avoid raising prices for consumers.
“These companies are acutely aware of the affordability crisis facing ordinary Americans,” Yale School of Management professor Jeffrey Sonnenfeld told the media. “They are doing their best to offset the costs of tariffs and higher rates, but they can only do so much. Those with pricing power will pass on the costs over time… Others will go out of business.”
However, the White House praised the tariffs as a net positive for the country.
“Tariffs are creating great wealthand unprecedented U.S. national security,” Trump wrote on Truth Social on Saturday. “The trade deficit has been cut by 60%, which is completely unheard of. GDP is 4.3% and rising. No inflation! ! ! We are respected again as a nation. “
The increase in bankruptcy filings has been most significant in the industrial sector — companies related to construction, manufacturing and transportation, postal Famous. The industry was one of the hardest hit by Trump’s tariffs, with manufacturing declining by 70,000 people year-on-year in November.
Consumer-oriented companies that offer “discretionary” services or products, including in the home or fashion sectors, make up the second largest group. “Megabankruptcies,” in which companies with more than $1 billion in assets file for bankruptcy, also increased significantly.
Companies filing for bankruptcy in 2025 include spirit airlinesa low-cost airline. The Florida-based company filed for Chapter 11 in August, its second filing in less than 12 months.
Louisiana-based solar company PosiGen did the same in November, blaming the decision on the government’s renewable energy policies, including tariffs on imported materials and cuts to tax incentives that make solar panels more affordable.
Federal data analyzed by Jason Miller, a business professor at Michigan State University, show that after May, the effective tariff rate on imported solar materials in the United States rose to about 20% from less than 5% in previous years.
“This puts a lot of pressure on cash flow, especially for smaller importers,” Miller told reporters. postal. “Then you combine that with reduced federal incentives, which is bound to have a negative impact on demand, and you have the perfect storm of rising bankruptcies.”
KPMG economist Martin Schoenberg added that the surge in bankruptcies highlights the contradictions of the U.S. economy. Government data released this week showed the economy grew at an annual rate of 4.3%, the fastest pace in two years.
But economists warn that the growth is unevenly distributed, arguing that it is mainly driven by spending by wealthy consumers and business investment. AI.
“Our economy looks strong on paper, but that may not necessarily be reflected in every industry,” Martin-Schonberg said.