United Kingdom: business closures in the second quarter
The number of UK businesses that closed in the second quarter was the highest since 2017, at 105,455, according to a report by the Office of National Statistics.
By 2017, by contrast, the number had reached 98,880 in the second quarter, which was higher than any year between that date and today.
The number in 2021 was 43% higher than that which had occurred at the same time in 2020.
The largest increases in business closures were recorded in the transportation and warehousing categories, as well as in the professional, scientific and technical industries. The report details the facts that there has been a 91% increase in closures for the transportation and storage industry. During this time, professional, scientific and technical enterprises grew by 35%.
The sixteen major groups, however, recorded an increase in closures.
Business closures, according to the report, have resulted in the removal of companies from the Interdepartmental Business Register (IDBR) in the UK. Companies are deleted from this register if their turnover and employment have been zero for several periods.
But the report notes that there was more robust-than-usual growth in business closures this quarter compared to the same period in 2020, as the second quarter of 2020 featured government assistance at that time. which probably kept too many businesses from closing early.
An April 2021 report found that many UK companies had reported being in financial difficulty – the report found more than 720,000 of those companies, according to data from insolvency firm Begbies Traynor. The number was a 15% increase from the number at the end of 2020, in addition to being a peak of 42% from the same period in 2020.
Read more: Over 720,000 UK businesses facing serious financial difficulties
The news came as the UK, at that time, was trying for the first time to reopen after the effects of the pandemic.
While the government’s relief efforts had been present, many companies had gone into debt. Rent was also a factor.