Personal insolvencies fall for first time since 2007
Figures today revealed the number of people being declared insolvent in England and Wales may have peaked after falling for the first time since 2007.
According to the Insolvency Service, there were 34,743 personal insolvencies in the April to June period, a fall of 3% compared with the first quarter.
However, they were still 5% higher than this time last year.
Meanwhile, there were 4,080 companies liquidated in the second quarter – slightly higher than the first quarter but down almost one fifth on levels a year ago.
The figures suggest Britain is now emerging from its worst recession in decades and that the worst may be over….for now.
Severe job cuts in the public sector could mean insolvencies will remain at a record high for some time to come.
Furthermore, tough austerity measures introduced by the coalition Government, as well as the ongoing lack of credit, could put more public sector focused companies under financial pressure.
Commenting on the figures, Malcolm Shierson at accountants Grant Thornton, said: “This is a welcome trend in the number of business failures, but the UK economy is not out of the woods yet.
“We expect to see an increase in business failures in outsourcing, as well as the hotel and leisure services sectors,” he added.