By Marcus Leach
Data released by the Insolvency Service shows that the number of people and businesses going bust has been stabilising.
The research revealed that personal insolvencies in England and Wales rose just 1% in the second quarter of the year.
Despite being up to 30,513, an increase of 368, personal insolvencies have almost been flat for the last nine months.
The data for businesses going bust was mixed, with a 5% drop in the second quarter, but the figure remains 22% up on the same period last year.
“The Insolvency Service data clearly shows that businesses are suffering," Andries Smit, founder, SMEDiscounts, said.
"The fact that almost 20% more businesses were in such a poor state that they were forced to liquidate is a worrying indictment of our economic state.
"The last time we saw company liquidations above the 16,000 per annum mark was in 2002, so although liquidations are flat quarter on quarter, this is still significantly higher than pre-recession days.
"Over a quarter of small to medium sized enterprises (SMEs) and sole traders responding to our survey describe their business as being in poor health, so it appears that the worst could be yet to come. Those who lack a great product or innovative approach are not going to be able to climb out of the rubble left behind by the economic implosion of recent years.
"It's notable how many self-employed individuals are going bankrupt. There is an increase in consultants and contractors being laid off by big businesses and at the same time there are head count freezes in big corporations, leaving them nowhere to go.
“The key question to ask is, are the two-thirds of businesses that we surveyed that think the worst is still to come doing enough to weather the looming storm?”
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