“There is no wall of bankruptcies”. Faced with soaring energy prices, the Minister of the Economy Bruno Le Maire ruled out on Wednesday January 4 on France Inter the hypothesis of an explosion in the number of companies which would be forced to go out of business. . “There is an explosion in the prices of electricity and gas which is hard to live with for thousands of entrepreneurs, but they are coping,” said the government’s number two.
“It’s difficult, we support them, but I won’t let it be said that it will be accompanied by a wave of closures, bankruptcies, because this is not the case”, he insisted, the day after the announcement of specific support measures for bakers. “Today, less than 1% of entrepreneurs plan to close or slow down their production,” assured Bruno Le Maire based on figures from INSEE.
According to the latest INSEE business survey, which specifically questioned industrial companies, the total drop in their production “directly linked to the rise in energy prices” would be around barely 1, 5%. However, as La Tribune reminds us8% of companies in the industry sector and 3% in the services sector indicated that they planned to reduce their activity because of their soaring energy bill, according to this survey by the National Institute of Statistics.
In its latest survey published at the end of October 2022, the Confederation of Small and Medium-Sized Enterprises (CPME) argues, for its part, that 9% of managers of VSEs/SMEs “envisage stopping their activity due to the rise in oil prices. ‘energy”. However, the government “contests” this figure, said Bruno Le Maire.
“You can give the example of Duralex or William Saurin”, two companies which recently announced a suspension or partial stoppage of their activity due to the explosion of energy costs, “but you will not be able to find hundreds of examples”, added Bruno Le Maire.
Despite inflation of more than 15% in energy prices between December 2021 and December 2022 according to INSEE, “there are few companies that are truly in great difficulty in the face of the explosion in electricity prices, and which would suddenly close or slow down their activity”, estimated the Minister of the Economy.
As regards, for example, the 33,000 bakers in France, hit hard by the increase in energy prices, there are “perhaps a few hundred bakers who are in real difficulty and therefore need” support measures unveiled Tuesday by the executive.
More broadly, “there are thirty times fewer partial activity schemes at the end of 2022 than at the start of 2022”, argued Bruno Le Maire. According to government figures communicated to AFP, the number of requests for partial activity (of common law) validated by the administration rose from 40,073 in January 2022 to 1,382 in November.
With regard to long-term partial activity, which aims to preserve employment in companies faced with reductions in activity due to a temporary shock (for example the pandemic), the number of validated authorizations has increased from 1496 in January 2022 to 385 in November.
This Thursday, the Banque de France for its part indicated that the number of business failures in France rebounded strongly in 2022 after the fall observed during the health crisis. Between January and December, 41,020 failures were recorded, compared to 27,592 between January and December 2021, according to figures published by the central bank.
“In 2022, the number of business failures is normalizing without however reaching pre-Covid crisis levels”, she specified in a press release: it is 20% lower than that recorded in 2019 (51,145 failures out of the year). “This normalization movement is common to all sectors of the economy and slightly more pronounced for SMEs excluding indeterminate sizes,” she added.
But “the Banque de France does not expect a wave of bankruptcies in the coming months”, underlined Emilie Quema, director of companies within the institution, thus going in the same direction as Bruno Le Maire.
In detail, in December over one year, failures more than doubled (105.7%) in accommodation and catering. This sector had benefited a lot from aid during the health crisis, when many establishments were forced to temporarily close their doors by the government. Industry (+64.3%), automobile trade and repair (+54.4%) also recorded clear increases.
The rise in insolvencies is particularly marked among SMEs (+48.7%), especially very small businesses (+95.8%) and small businesses (+92.2%). It is much less so in medium-sized companies and large companies (+20.8%).
