Company insolvencies rise by almost a fifth

In March there was nearly 300 compulsory liquidations, and administrations rose to 144 and company voluntary insolvencies doubles to 18.

Official data showed the UK economy had left the recession last week as in the first quarter the gross domestic product (GDP) grew 0.6%.

Company insolvencies hit a 30 year high last year due to soaring interest rate, cost pressure and energy bills rising, but despite the latter having now come down consumer spending is under pressure.

Wilko, the Body Shop’s UK stores and Ted Baker all collapsed as retail and the hospitality sectors have been particularly hit the hardest.

David Hudson, restructuring advisory partner at FRP, said, “Last week’s GDP figures suggest that the UK economy is finally emerging from its lengthy post-Covid hangover.

“But while there is optimism this growth can be sustained, the coming months will continue to be turbulent with more businesses faltering as they weather the legacy of high interest rates, input costs and wage growth.

“Indeed, while we anticipate monthly fluctuations as insolvency levels settle, our own data suggests the profile of firms going into administration is increasingly that of larger employers which will ultimately have a more pronounced effect on supply chains and the labour market.”