Corporate insolvencies rise signals economic woe
Failing businesses up 1.8% in third quarter, with the worse still to come
Continued growth in the number of corporate insolvencies could threaten the
UK economy as the credit crunch starts to hurt businesses.
Government statistics have revealed a
1.8%
rise in the number of companies hitting the wall over the three months to
September, with more companies expected to struggle in the coming months as the
squeeze on credit hits hard.
Those in the travel, tourism and agriculture industries are likely to feel
the full force of the changing market conditions.
Peter Sargent, council member of insolvency trade body
R3 said that he had already noticed
changes in the leisure and tourism industries and small businesses will be the
first to suffer as credit becomes harder to obtain.
Grant Thornton has estimated that corporate insolvencies will rise by a
further 5%-10% during the last three months of the year, with worse to come in
2008, according to the Financial Times, which could deal a huge blow to the UK
economy.
Further Reading:
Businesses
put on insolvency alert