An unexpected month-on-month dip in the number of corporate insolvencies in England and Wales is bringing respite to East Midlands businesses and signals hope that the summer months will bring a significant boost to trade.
This is according to the Midlands branch of the UK’s insolvency and restructuring trade body R3, and comes on the back of latest figures published by the Insolvency Service which show that corporate insolvencies decreased by 8.4% in June to a total of 2,043, compared to May’s total of 2,230, and fell by 15.9% compared to June 2024’s figure of 2,430.
R3 Midlands chair Stephen Rome, a partner at law firm Penningtons Manches Cooper in the region, said: “For the first time in many months we have seen a reduction in corporate insolvencies, now dipping to their lowest level for June since 2022.
“While a single month of data does not indicate a long-term trend, it may signal that some directors are holding back from taking formal action for now, either due to improvements in trading conditions or in the hope that the summer months will bring a sizeable increase to their business.
“It should be borne in mind, however, that the broader economic mood remains subdued. Businesses and households alike are low in confidence and, as a result, key decisions are on hold and a “wait and see” attitude is being adopted.
“With GDP growth declining for the second month in a row in May, and unemployment levels recently increasing, it remains to be seen how this economic trend will impact our region over the longer term.
“R3’s message to anyone who is worried about finances is to seek advice as soon as possible. We’ve seen countless examples of businesses reaching out too late – so many of them could have achieved a more positive outcome if they had acted sooner.
“Most R3 members will give prospective clients a free initial consultation to learn more about their situation and outline the potential options open to them to improve it.”
