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48,000 UK businesses on ‘brink of collapse’, warn insolvency experts

48,000 UK businesses on ‘brink of collapse’, warn insolvency experts
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Every day restaurant, shops, hotel’s are closing. There are no business, hotels, restaurants are being empty. In this situation thousands of people lose their jobs.

25% jump in firms facing ‘critical’ financial distress, with property and construction sectors featuring heavily, says Begbies Traynor.

More than 47,000 UK companies are on the brink of collapse after a 25% jump in the number of businesses facing “critical” financial distress in the final three months of 2023, according to a report.

It marks the second consecutive quarter-on-quarter period when critical financial distress has risen by a 25%, the latest “Red Flag” report by insolvency specialists Begbies Traynor found.

The construction and property sectors accounted for 30% of all businesses facing critical financial distress.

The quarterly rate of increase in the number of companies facing critical financial distress grew by 32.6% in the construction industry, by 41.3% in health and education, a quarter in real estate and property services and 24% in support services.

Eighteen of the 22 sectors covered by the report recorded double-digit percentage growth in the number of firms whose finances have reached critical condition.

Julie Palmer, a partner at Begbies Traynor, said the tough macroeconomic conditions had created a “perfect storm” for UK businesses.

“After a difficult year for British businesses that was characterised by high interest rates, rampant inflation, weak consumer confidence and rising and unpredictable input costs, we are now seeing this perfect storm impact every corner of the economy,” she said.

Top 10 sectors with firms facing ‘critical’ financial distress

  • Construction (7,849)
  • Support services (7,096)
  • Real estate & property services (6,228)
  • Professional services (4,347)
  • General retailers (3,133)
  • Telecoms & IT (2,830)
  • Health & Education (2,719)
  • Media (1,828)
  • Financial services (1,373)
  • Food & drug retailers (1,343)
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Dulal Ahmed Chowdhury is the Editor of The Daily Dazzling Dawn. Previously, he has been serving in important positions in all the famous national dailies of the Bangladesh since the nineties. He has played a commendable role in journalism by participating in various events at the national and international levels. United Nations Conference, World Climate Conference, SAARC Summit are notable among them.

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