Insolvencies rise again but it could have been worse
The government stats released today show company insolvencies up 56% on the 1st quarter of 2008- In the first quarter of this year, the insolvent company count came to 4, 941. Back on February 6th, I forecast that insolvencies may exceed the 5000 barrier, so the real figures came in a little shy of that. I hear murmurings around that banks are beginning to lend again to businesses, and let’s hope that this leads to a slowing down in the growth of failed companies. Don’t forget, back in the early 90’s recession, insolvencies reached a quarterly level of over 6000.
What’s still extremely worrying is the impact this recession is having in our high streets. The degree to which we are spending our money in the shops is being influenced by general jitters about the economy and job security, so I expect to witness more shop closures over the coming months. Retailers of household goods and fashionwear are continuing to face serious threats to their survival. This sector of the economy was certainly not impressed with the Chancellor’s budget last month, arguing it did absolutely nothing to help retailers in their present state.