It may come as a surprise that, despite the pandemic, bankruptcy filings have significantly fallen over the past year: As of March 2022, annual bankruptcy filings totaled 395,373, compared with 473,349 cases in the previous year, according to statistics recently released by the Administrative Office of the U.S. Courts. That’s a 16.5% decrease.
Government relief programs and an historic rise in household wealth fueled by a strong stock market and higher real estate prices are among the reasons to explain this trend. But unfortunately, many experts believe that this trend will reverse, and bankruptcies will soon be on the rise.
Why? Because higher inflation, supply chain woes, a slowdown in global output and rising interest rates are contributing to a growing concern that the U.S. economy could be entering into a recession sometime this year. If that happens, then small businesses, some still reeling from the pandemic, may see a…
