The number of East Midlands businesses experiencing insolvency-related activity in January jumped by 16.1% compared to the same period in 2022, according to new research from the Midlands branch of R3, the insolvency and restructuring trade body.
R3’s figures, which are based on an analysis of data from business intelligence provider Creditsafe, show that there were 72 cases of insolvency-related activity in the region last month, up from 62 in January 2022.
The statistics, which include liquidator appointments, administrator appointments and creditors’ meetings, show a similar picture for December 2022, with a 22.8% year-on-year rise in insolvency-related activity compared to December 2021.
The figures come on the back of a number of high-profile company administrations in recent weeks, including local high street retailer Paperchase, and the airline Flybe, which served the region from its West Midlands base at Birmingham Airport.
R3 Midlands chair Eddie Williams, a partner at PwC in the region, said: “What we are seeing here in the East Midlands is a reflection of what is happening to businesses at a national level, where annual insolvency numbers are now riding at a 13-year high.
“Statistics published by the Insolvency Service at the end of January show that corporate insolvencies in England and Wales increased by 57.3% last year to 22,109 compared to 2021’s figure of 14,059, and by 75% in comparison to 12,632 in 2020.
“Rising numbers of company directors in the East Midlands are now turning to insolvency processes to resolve their financial issues in the face of rising costs, low consumer confidence and ongoing economic turbulence.
“These issues will not disappear overnight, and we urge business owners to be aware of the first signs of financial distress and seek advice from a qualified source as soon as they show themselves. Many R3 members offer a free initial consultation to those who are looking for such help and want to explore their options.”
