Corporate failures threaten 1.5m jobs in Europe: study

(FRANKFURT) - The number of companies going bust as a result of the eurozone debt crisis is on the increase and could see as many as 1.5 million jobs across Europe under threat as a result, a study found Tuesday.

Creditreform, a business information service and debt collection organisation, said in its latest annual insolvency report that the number of corporate insolvencies in the EU-15 group of countries plus Norway and Switzerland edged up by 0.3 percent to 174,917 in 2011.

One out of every three insolvencies affected a company in the services sector, Creditreform said.

The increased pace of insolvency was increasingly threatening jobs, with some 1.5 million posts seen as under threat last year, an increase of 7.1 percent over 2010, the organisation said.

In 2009, a record 2.0 million jobs were under threat from insolvency.

The situation could deteriorate further this year with medium-sized companies often reacting to the difficulties on the financial markets too late, the study said.

Developments varied from country to country, with the strongest increase in corporate failures seen in Greece, followed by Spain, Italy and Portugal.

By contrast, the number of bankruptcies declined in both Germany and France.

Another symptom of the crisis was that one out of every four German exporters experienced a delay of more than one month in payment from customers in Italy, Spain or Portugal, the organisation said.

The situation was substantially worse in Eastern Europe where nine out of 10 German exporters suffered a delay in payments from customers in Romania, Croatia, the Czech Republic and Hungary.