Danish bankruptcies cost 1,000 jobs in September

Danish bankruptcies cost 1,000 jobs in September
A closed cafe in Copenhagen during Denmark's lockdown in March. Photo: Ida Guldbæk Arentsen/Ritzau Scanpix
A large number of Danish companies went bankrupt in September, resulting in job losses equivalent to 1,000 full time positions.

In total, 183 active Danish companies went bankrupt last month, resulting in 1,155 full time jobs being lost.

The number, registered by Statistics Denmark, is twice that recorded in August.

If figures from March onwards are taken into account, the number of jobs lost due to bankruptcies in 2020 is 25 percent more than that for the corresponding period last year.

That appears to point to a significant economic impact due to coronavirus, in keeping with other indicators earlier reported in Denmark.

READ ALSO: What does Denmark's GDP drop tell us about jobs and the economy? 

“The lost jobs come primarily from sectors hardest-hit (by coronavirus) such as hotels and restaurants, where you are also employee-heavy,” economist Anders Christian Overvad of Arbejdernes Landsbank told Ritzau in a written comment.

“With an expected increase in bankruptcies, we also expect the number of lost jobs to increase,” Overvad added.

The economist added that a “relatively short, but extremely deep” downturn was expected in the Danish economy.

“The big blow to Danish economy will undeniably cause more businesses to go bankrupt, but we will also see this happen over a short period,” he said.

“However, the probability of a longer (economic) crisis has increased – if the crisis changes character, we will also see a larger increase in the number of bankruptcies,” he said.

Unemployment was up by 50,000 compared to the level in March, when the pandemic first reached Denmark, but has since recovered somewhat, standing at 23,000 more than the number at the beginning of the spring.

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