Company Failures Rise in England and Wales Amid Economic Challenges
In April 2024, company insolvencies in England and Wales surged by 18%, totaling 2,177 according to the Insolvency Service. This increase followed a month of decline and corresponds with a recent 0.6% GDP growth indicating the UK’s emergence from a short recession.
The rise was driven by an 18% increase in creditors’ voluntary liquidations, reaching 1,715. Compulsory liquidations increased by 11% to 300, administrations rose by 36% to 144, and company voluntary arrangements doubled to 18.
Key sectors affected include construction (17% of insolvencies), wholesale and retail trade (16%), and accommodation and food services (15%). The hospitality sector has seen substantial increases in insolvencies due to post-Covid challenges, staff shortages, price increases, and reduced consumer spending.
Notable business casualties include Wilko, The Body Shop’s UK operations, and Ted Baker.