Sunday, July 21, 2024

Call for new government to support East Midlands entrepreneurs as start-ups slump

The steep drop in the number of new businesses set up in the East Midlands has continued into a second month, with significant numbers of local entrepreneurs holding back while the political landscape remains uncertain.

This is according to the Midlands branch of national insolvency and restructuring trade body R3 and is based on a monthly analysis of regional start-up data from business intelligence provider Creditsafe.

R3’s figures show there were 2,141 businesses set up in the East Midlands in June, which is a substantial 40.51% decrease compared to the 3,599 new businesses registered in April, prior to the announcement of the General Election. The May figure for the region was similarly low, with only 2,076 start-ups during the month.

These statistics sit within a volatile economic backdrop while the local economy waits for the dust to settle on the new government. There remains a high number of East Midlands companies with late payments on their books – 23,736 in June – and also a growing quantity of debts owed by liquidated firms in the region.

R3 Midlands Chair Stephen Rome, a partner at local law firm Penningtons Manches Cooper, said: “It’s apparent that entrepreneurs have, understandably, taken a cautious approach over the last couple of months, waiting to see how they may be supported or held back by a change in government.

“Going forward, it’s vital for start-ups to have a reliable economic platform to launch their undertakings, particularly as they are still having to navigate the longer-term economic challenges of inflation and spiralling fuel, energy and wage costs. Helping to achieve this has to be a political priority for our new politicians, law-makers and opinion formers.

“In the meantime, should significant cash flow difficulties arise for new entrepreneurs or established business owners alike, it’s crucial to take professional advice as soon as possible. There is a significant amount which can be done to rescue and support local businesses if help is taken early enough.”

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