Shillong, July 26: During the first half of this year, Sweden witnessed a surge in company bankruptcies, reaching a total of 3,949, the highest in ten years, according to state media reports. This resulted in the loss of over 28,000 jobs in the same period.
The hardest-hit sector was the hotel and restaurant industry, especially in May and June, which experienced a staggering 90% increase in bankruptcies compared to the same months in 2022. The staff-intensive nature of this industry created a vicious cycle of more bankruptcies, rising unemployment, and reduced consumer spending, as explained by Johanna Blome, an economist at UC, a business and credit reference agency.
As per IANS, while hotels and restaurants were hit the worst, bankruptcies also increased across all major industries, with an 83% surge in the worst-affected sectors during the first six months compared to the same period last year. The capital region saw a 23% increase in bankruptcies compared to the first half of 2022.
Rising costs due to inflation were cited as the primary reason behind the increasing number of bankruptcies, with the latest figures indicating inflation at 9.3% year-on-year in June, as reported by Statistics Sweden on July 14.
Additionally, businesses had to face an additional cost this year, not present in the previous year, as mentioned by Ingela Gullstrand, a business advisor in the Ostergotland region, without specifying the exact cost.
