Partner Article

Business failures surge in North East

BUSINESS failures in the region have reportedly doubled in two months, according to figures from credit-checking agency Experian.

Although the national insolvency rate has been improving since early 2009, dropping from 0.09 per cent of all businesses in August to 0.08 per cent in September, the figure for the North East rose from 0.06 per cent to 0.15 per cent during the same period.

The Financial Times said the large fluctuation in the north-east’s figure is partly a reflection of the fact that the region has only 40,500 businesses; the smallest number of any part of the UK – and less than a 10th of the 494,500 in London.

Tim Pain, head of business, enterprise and skills at One North East, the region’s development agency, said that there had also been an uptick in start-ups locally, which typically have a higher failure rate.

“During times of recession people tend to explore their career options, which often leads to an increased number of start-up businesses, which can in turn lead to an increase in the number of insolvencies and business closures,” he said.

According to research by Royal Mail this month, Sunderland was the fastest-growing city in terms of businesses established during the past six months.

This was posted in Bdaily's Members' News section by Ruth Mitchell .