Kroll, the global risk and financial advisory, has published new monthly insights on the number of companies across the UK entering administration.
UK businesses face economic headwinds from factors including inflation, supply chain pressures and access to finance. Kroll figures provide a comprehensive view into the health of UK plc showing the number of companies who have entered administration.
In July 2022, 75 businesses entered administration, a fall from 91 in June and the year’s peak in March (96). In the year to date, there has been 522 administrations, averaging at 75 per month which is tracking 36% higher than 2021 on a pro-rata basis.
In the year to date, the sector most affected has been construction, which is historically the case, with 76 to date. This is closely followed by manufacturing (72) and real estate (60). In July, the top three sectors were construction (20), manufacturing (10) and leisure & hospitality (9).
Based on this current trajectory, Kroll projects the UK could reach up to 895 administrations in 2022, up from 659 in 2021 but below pre-Covid levels in the first half of 2020 (1,222 on an annualised basis) and 2019 (1,392).
Benjamin Wiles, Managing Director, Restructuring, Kroll, “There is a lot of focus on the health of the economy and the impact it will have on consumers and businesses.
“At current rates, we are expecting to see a lower number of company administrations this year. Despite the pressures on companies, there is still a lot of support for business – through Covid loans or rate relief – but also through the support from creditors, notably HMRC, who have given more leeway and support of payment arrangements over the last few years.
“For now, consumer spending remains robust, but there are indications that consumer confidence is lowering, and we may see a reduction in spending in the Autumn, though maybe not as much as we’d expect.”