New York Bankruptcy Filings Continue To Skyrocket And It’s Only Going To Get Worse
New York bankruptcy filings are still well below Great Recession levels. However, analysts say there is an unmistakable trend upward.
New York state’s bankruptcy filings have risen steadily the past three years. They hit 34,711 in 2018. This is up from 30,112 in 2016 according to the American Bankruptcy Institute (ABI).
More consumers nationwide are also falling behind on their payments and filing for bankruptcy. Low unemployment and an uptick in average wages have not curbed the debt monster. Middle-class consumers are even finding relief at food pantries.
New York bankruptcy filings are also being fueled by unmanageable business debt. As a result, this is triggering a wave of job cuts. Corporate bankruptcy filings have caused 43,000 job losses in the first seven months of this year. According to a new report by Challenger, Gray & Christmas, this is almost 20% more than all bankruptcy-linked job cuts in 2018. In the latest example, last week Barneys New York said it had filed for Chapter 11 bankruptcy protection.
ABI says bankruptcy filings have surged by 3% in July 2019 from July 2018. A total of 64,283 filings were reported for July. This is an increase from 62,241 for July 2018. Bankruptcies could hit 796,000 for 2019.
Meanwhile, record American household debt, near $14 trillion including mortgages and student loans, is some $1 trillion higher than during the Great Recession of 2008. Credit card debt of $1 trillion also exceeds the 2008 peak.
Americans are spending heavily. Here we go again!