50,000 UK businesses to go bust
More businesses to go bust over the next three years
A slowing economy could lead to as many as 50,000 UK business
going bust in the next three years; the first increase in business failures
since 2002.
The figures, from BDO Stoy Hayward’s latest Industry Watch,
predicted that business failures would rise by just 0.9% in 2005 to 15,968, or
307 per week, compared with 15,876 in 2004.
However, the number of failures should hike up by 5% in 2006,
and a further 1.9% in 2007, which would equate to around 1% of all UK
companies.
Sectors set to suffer include manufacturing, where slowing
consumer spending and rising oil prices will see 7,000 companies fold in the
next three years, and the the leisure sector, where 1,116 will fail during 2007,
from 1,082 in 2005.
Shay Bannon, business restructuring partner at Stoys, said
that ‘management needs to be prepared’ for a more difficult economic environment
during the next 18 months.