THERE HAS been a big jump in the number of businesses going bust in the North, according to latest statistics. Official figures show 65 companies in Northern Ireland became insolvent in the three-month period to June of this year. This represents a 14 per cent increase on corresponding insolvency statistics for 2008.
According to PricewaterhouseCoopers, the number of business failures in the North has soared to 122 in the first six months of this year.
Garth Calow, business recovery services partner with PwC, said failures were increasing steadily.
“While quarter two saw a slowdown in the number of failures, the overall trend is still up and there have already been more business failures in the first half of 2009 than in the whole of 2002.”
PwC says there has been a significant rise in creditors’ voluntary liquidations in the second quarter – from 15 last year to 19 in the year to date. Compulsory liquidations have also increased by nearly 10 per cent, with 46 companies liquidated on the orders of the court.
The statistics come as another new report shows the North is lagging behind the rest of the UK on recovery. The latest Ulster Bank Northern Ireland Purchasing Managers’ Index (PMI) survey shows the North was the only part of the UK not to record an upturn in business activity last month.
Although the PMI survey also shows that both output and new business levels in the North’s private sector fell at the slowest pace since May 2008, the North lags the wider UK economy.
Richard Ramsey, Ulster Bank’s Northern Ireland economist, said the latest research suggested companies cut their workforces for the 17th month in a row in July. He added: “Northern Ireland’s private sector has now posted 20 consecutive months of output declines. However, the pace of decline has slowed for the fourth month in a row.”
He believes the expected recovery, when it comes, will be “weak, with new orders continuing to fall at a significant, albeit slower, rate”.
But there is one glimmer of hope on the horizon for the North, according to the Royal Institution of Chartered Surveyors.
It believes the rate of “house price correction” in Northern Ireland has slowed significantly and buyers are returning to the market.
