1,170 Companies go bust every day

December 7, 2011 No Comments

More than 1,170 companies collapsed on every working day last year, the Office for National Statistics revealed yesterday.

The highest number of business ‘deaths’ since records began highlights the crisis facing Britain, amid fears the number of casualties will climb even higher as the economy continues to falter.

The official figures also show that the number of new businesses being started has slumped to an all-time low.

The scale of the devastation reveals that fewer than half of the businesses set up in 2005 were still going by the end of 2009.

Behind the figures lies a personal tragedy for every entrepreneur and their staff, who face a search for a new job at a time when unemployment has hit a 17-year high of 2.62million

A spokesman for the Forum of Private Business said: ‘The figures speak for themselves – 2010 was truly the private sector’s “annus horribilis”. It paints a gloomy picture.’

In 2010, 235,000 businesses were ‘born’ – registered for VAT or pay-as-you-earn taxes – which was even fewer than during the depths of the recession in 2008, when there were 267,000 start-ups.

At the same time, the number  of businesses which ‘died’ – deregistered for taxes – climbed to 297,000, equal to 1,173 being closed every working day. Again, this is far higher than during the period of recession in 2008, when 223,000 businesses shut down.

To add to the pressure on small firms, high inflation means they will also face an increase in business rates of £1.3billion next year.

A spokesman for the Department for Business said: ‘Small firms and start-ups are at the heart of our economic plan, and we want to create the right environment to help them thrive and succeed.

‘We have a number of measures and initiatives in place to help anyone wanting to start or grow their own business.’

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