US small business bankruptcies are surging as if there is a recession:

A record 2,221 small firms have filed for bankruptcy under Subchapter V year-to-date.

Subchapter V allows businesses and individuals with under $3 million in debt to reorganize more quickly and cheaply than traditional Chapter 11.

Bankruptcies have risen +83% over the last 5 years.

This surge has continued despite the debt limit being reduced from $7.5 million to $3 million last year, which made it harder for larger businesses to qualify.

The increase has been driven by persistently high borrowing costs, cautious consumer spending, and overall economic uncertainty, which have weighed on small business earnings.

US small firms are struggling

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