UK business financial distress reaches its highest level since 2004
The number of UK businesses in significant financial distress reached 738,144 in the third quarter, the highest level since BTG began tracking the measure in 2004. The rise adds pressure on Chancellor John Healey to offer businesses more support in Wednesday’s budget, as companies face higher costs and a volatile economic outlook.
Distress was most widespread in support services, construction and real estate, with 118,695, 108,340 and 99,908 firms affected respectively. Hospitality saw a 5% annual increase to 18,866 struggling bars and restaurants, while food and drug retailers rose by more than 7% to 19,269. Businesses also owed HMRC £27.3bn in tax arrears at the end of August, down from a pandemic peak of £51.3bn but still well above the pre-pandemic £11.4bn.
In short
- Business distress reached a record 738,144 firms.
- Hospitality distress rose 5% in a year.
- Firms owed HMRC £27.3bn in tax arrears.
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Originally published by The Guardian as “Number of UK businesses in financial distress ‘at two-decade high’”.