Despite increased optimism about the UK’s economic prospects, observers pointed to the 2,191 firm insolvencies in July as evidence of how many businesses were still recuperating from the impact of high borrowing prices and inflation.
Although the total was 7% lower than in June, insolvency levels are still far higher than they were during the COVID-19 pandemic and the years that followed the 2008–2009 financial crisis, according to officials.
The report serves as “a strong reminder that many businesses are still a long way off from recovery,” according to Rebecca Dacre, a partner at the advisory firm Forvis Mazars.
In spite of early indications that the economy is improving, she continued, some industries are fine.
A further challenge to some firms’ survival during the cost of living issue has been the decline in customer spending. The hospitality and retail industries have taken the brunt of this; unless the economy recovers more forcefully, more businesses will probably be forced into bankruptcy.
