In 2023, Luxembourg’s construction sector recorded 155 bankruptcies, marking a 35% increase from the previous year. Prominent companies such as , and Decorlux were among them. This surge represented 16.4% of Luxembourg’s total of 944 bankruptcies, noted a recent report by the data and debt collection agency Creditreform.

Contrary to the construction sector, Luxembourg experienced a 6% overall reduction in bankruptcies, totalling 944 by 31 December 2023, according to Juan Santiago, authorised manager of Creditreform Luxembourg. This decrease sharply contrasts with neighbouring countries like Germany, Belgium and France, which saw increases in the number of bankruptcies by 23.5%, 9.65% and 34.4% respectively.

Older businesses, those operating for over five years, were more prone to bankruptcy, the report found. They accounted for 558 (59%) of the bankruptcies, compared to 386 (41%) among younger companies. A broader view from 2017 to 2020 shows that younger companies (under five years) had an average bankruptcy rate of 24%, significantly lower than the 76% for older companies, stated Creditreform.

The service sector led in bankruptcy numbers with 497 cases, though this was lower than the 571 in 2022. Other sectors like commerce, manufacturing and horeca (hotel, restaurant and café) also witnessed decreases.

Looking ahead, Creditreform anticipates an increase in bankruptcies in 2024, as Luxembourg has not returned to pre-Covid crisis levels, which averaged 1,229 bankruptcies annually between 2018 and 2019. Nevertheless, the government has introduced several measures that are expected to mitigate current challenges, as previous state aids have successfully cushioned businesses against major insolvency waves, Creditreform stated.