Business bankruptcies in France 2013-2020

The number of business failures in 2020 had reached its lowest level since 2013. By 2020, just 30,000 businesses were unable to meet their financial obligations, such as paying salaries or suppliers.

COVID-19 and business failure, a paradoxical situation

This situation was astonishing when compared to the evolution of the GDP in France, which fell by more than 8 percent that same year. The French state played an essential role in preventing the bankruptcy of many companies. As early as March 2020, short-time working was implemented, as well as tax exemptions or loans guaranteed by the state. This guaranteed loan allowed companies to pay their suppliers and thus avoid a domino effect of payment defaults and company closures.

A soaring national debt

The consequence of these governmental measures has been to avoid an increase in business closures and a rise in unemployment. In 2020, the unemployment had even decreased by 0.1 points compared to 2019. On the other hand, the French debt rose sharply between 2019 and 2020, from 98 percent of its GDP to over 113 percent.