Notable improvements came from mid-sized firms. In the 26-50 employee bracket there was a change from 0.21 per cent in August last year to 0.15 per cent this August – their lowest insolvency rate since December 2007. Continuing the positive trend shown in July, firms in the 11-25 employee bracket also did well – down from 0.21 per cent last August to 0.08 per cent this year.
Max Firth, Managing Director, Experian Business Information Services, UK&I said: “Since March we’ve seen insolvency rates flatten out, which is a positive and welcome trend. In addition, we’ve seen real pockets of improvement, such as in Scotland and Yorkshire, which have been sustained over a number of months now.
“But firms cannot afford to be complacent. They need to continue sensible financial practices such as risk planning and monitoring their financial health and those of their customers and suppliers.” Firth concluded.
Scotland continues its good run
Building on its improvement since January 2012, Scottish firms continued to do well in August, with an insolvency rate of 0.06 per cent compared to 0.09 per cent in August 2011. This represented a slight increase on its lowest ever figure in July, but was still the most improved out of the regions in August compared to a year ago.
The picture in Yorkshire was also relatively good compared to the rest of the UK – with a fall in its insolvency rate from 0.10 per cent in August last year down to 0.08 per cent in August 2012. It also saw a fall from this July’s figure of 0.11 per cent – the biggest month-on-month drop of all UK regions.
Out of the top ten largest sectors in the UK, Leisure and Hotels fared best, with a drop in the insolvency rate from 0.15 per cent in August 2011 to 0.12 per cent in August 2011 – better than all of the other sectors.
A number of larger sectors saw their insolvency rates increase marginally year-on-year, but the largest increase was in the Banking and Finance sector, which saw an increase from 0.08 per cent in August last year to 0.12 per cent this year, although this was also a drop from the rate of 0.13 per cent in July this year.