The latest data from the Office of the Superintendent of Bankruptcy (OSB) shows consumer insolvencies rose modestly in May 2025, up 3.1% compared to April. There were 12,004 filings in May—1.6% fewer than May 2024, but 5.0% higher in the 12-month period ending May 31, 2025, compared to the 12-month period ending May 31, 2024, according to the Canadian Association of Insolvency and Restructuring Professionals (CAIRP).
The Association said that even with short-term fluctuations, consumer insolvency volumes in 2025 remain notably higher than pre-pandemic norms. In the first five months of 2025, the number of insolvencies filed each month exceeded the pre-pandemic monthly average of 10,634 filings (May 2016 to December 2019). Year to date, there have been 57,875 filings—7.6% higher than the pre-pandemic 5-month average of 53,784, it said.
“These figures indicate a new baseline of insolvency filings and financial distress in Canada,” says André Bolduc, Licensed Insolvency Trustee and Chair of Canadian Association of Insolvency and Restructuring Professionals (CAIRP), the national voice on insolvency matters in Canada.
“Although recent interest rate cuts and subsequent pauses may have offered some initial relief, many households are still grappling with persistent high living costs, stagnant incomes, and debt accumulated during a period of steep borrowing rates.”
CAIRP has 1,400 members and associates.
Business Insolvencies Decline but Remain Elevated Over Pre-Pandemic Norms
CAIRP said business insolvencies declined 16.5% in May compared to April, with 391 filings. Year-over-year, filings were down 26.2% compared to May 2024—marking the eighth consecutive month of year-over-year declines. Over the 12-month period ending May 31, 2025, business insolvencies were down 13.3% compared to the previous 12-month period.
Despite these declines, insolvency volumes remain significantly above pre-pandemic levels. The pre-pandemic monthly average (May 2016 to December 2019) was 303. May’s total of 391 filings is roughly 29% above that baseline. All five months of 2025 have exceeded the pre-pandemic average—and business insolvency levels have consistently trended higher since late 2022, it said.
From January to May 2025, there were 2,191 business insolvencies filed—34.7% higher than the pre-pandemic five-month average of 1,626, added CAIRP.
“Although headline numbers show a decline, business insolvency levels remain elevated compared to pre-pandemic norms,” said Bolduc. “This ongoing trend reflects the lasting impact of economic disruptions, inflationary pressures, and evolving uncertainties for Canadian businesses that continue to challenge business stability across multiple sectors.”
Sector Data Reflects Ongoing Economic Pressures
Insolvency volumes declined across nearly all sectors in May 2025 compared to the same month last year. The construction sector saw the largest year-over-year drop (63 filings, -29), followed by transportation and warehousing (22 filings, -21) and manufacturing (23 filings, -16), said CAIRP.
“Despite the declines, accommodation and food services (65 filings) and construction (63 filings) remained the sectors with the highest number of insolvencies, accounting for 16.8% and 16.3% of total filings, respectively. These sectors continue to face pressures from high operating costs, labour shortages, and reduced consumer demand,” it said.
“Only two sectors experienced an increase in insolvency filings year-over-year: agriculture, forestry, fishing and hunting (9 filings, +4) and arts, entertainment and recreation (10 filings, +1).”
Regional Pressures Still Evident
Newfoundland and Labrador stood out once again in May, posting both the largest year-over-year (+16.6%) and month-over-month (+10.6%) increases in consumer insolvencies, compared to the rest of the provinces. This continues a trend seen in April, when the province also saw the highest year-over-year increase among all provinces (+17.4%). New Brunswick experienced the second-highest year-over-year increase in May, where consumer insolvencies rose 9.1%, according to the CAIRP report.
“In smaller provinces like Newfoundland and Labrador, even modest increases in insolvency filings can be a strong indicator of deepening financial strain at the household level. With smaller populations, each case carries more weight, and the ripple effects can be felt more broadly across communities,” explained Bolduc. “It’s critical for individuals facing financial challenges to know they’re not alone—and to have access to trustworthy guidance and support systems that can help them regain control and find a path forward.”
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