Many of the professionals I work with in insolvency related professions say that despite the double (or triple) dip recession, they are not experiencing the increase in work that is typical following a recession.
In the past, the trend was that the peak of insolvencies occurred about 18 months after the deepest trough of the recession – as those businesses who had managed to survive then collapsed as they over-traded as markets picked up or as the banks decided to finally pull the plug.
So it was interesting to read the latest figures on business failure.
Duedil reports that at the height of the recession in 2009, 500,000 businesses folded. Yet after a net loss of 127,000 companies in 2009, every region saw the number grow last year and the total now tops 180,000.
Other statistics indicate:
- Total businesses in the UK in 2010 was 2.7m and in 2011 it was 2.9m – so the number is increasing significantly now
- 312,000 businesses closed in 2008, 492,0000 businesses closed in 2009 and 297,000 in 2010 – the peak was in 2009
- The change in the overall number of businesses is as follows:
- 2006 +7.6%
- 2007 +7.3%
- 2008 +1.4%
- 2009 -4.6%
- 2010 +3.7%
- Since 2009, health care (15.1% growth), legal services (11.3%), education and public services (6.5%) have fared the best while construction and real estate grew 2.5% and human resources was the only sector to contract in 2010 (by -7.5%)
So whilst there are many reports about the recession, slow economic growth and dampened property prices the number of new businesses continues to increase while business closures don’t seem to look so bad. What do you think?