Dramatic fall in company start-ups, reports the Guardian
09 02 2009 United Kingdom
The number of new companies being created in Britain has suffered its steepest decline since the oil crisis of the mid-1970s, according to figures reported by the Guardian
The Guardian has revealed figures compiled by accountancy firm Wilkins Kennedy showing that 372,400 new companies were established in 2008 compared with 449,700 in 2007, a drop of 17.2 per cent.
According to Wilkins Kennedy, the slump in new firms registered with Companies House is almost twice as severe as the drop during the previous recession, when there was an 8.6 per cent fall in new start-ups in 1991.
Roger Williams, a partner at the accounting firm, told the Guardian: "It gives you some indication just how unfavourable the climate now is for starting a new business if you have to go as far back as the oil crisis of the 1970s to find a steeper decline in new company formations."
Figures published by The Insolvency Service show that the number of company liquidations in the last quarter of 2008 increased by 51 per cent on the same period a year ago. During 2008 approximately 1 in 150 active companies went into liquidation.
Additionally, there were 2,428 other corporate insolvencies in the fourth quarter of 2008, representing an increase of 220 per cent on the same period a year ago.
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