Companies up and down Britain are closing as Britain grapples with the cost-of-living crisis, with more than 250,000 closing in the first half of this year, the largest ever recorded in a six-month period.
Statistics from the Office of National Statistics (ONS) show that company closers are 16% higher than the first half of 2021, according to the Wall Street Journal.
Data on the July-September quarter will be released by the official statistics body later this month, the Wall Street Journal reports.
Near-record levels of debt
Ninety-five percent of Britain’s companies are small businesses with nine employees or fewer.
SMEs in the UK are also facing high debt levels, close to those reached in 2020 at the height of the pandemic.
Banking trade body UKFinance says that borrowing by British small businesses is at £204 billion – far higher than 2019’s figure of £167 billion.
Britain’s services sector slowed to a standstill in September after 18 months of successive growth, amid soaring energy prices.
Business pessimism on the rise
The move led business expectations for the next 12 months dropping to their lowest level since May 2020, according to S&P Global and the Chartered Institute for Procurement and Supply.
The Purchasing Managers index survey showed 50, the weakest performance since February 2021 – a reading above 50 signals growth and below indicates contraction, meaning the sector flatlined.
New orders also declined for the first time in 19 months.
John Glen, chief economist at CIPS, said: “More evidence of weaknesses in the UK economy appeared last month as the services sector flatlined in September, falling to the no-change mark with fewer orders and higher costs affecting output.
“The new business index was the lowest since February 2021 as domestic consumers had cost-of-living pressures and not hospitality uppermost in their minds.
“After enjoying rising levels of export orders for eight months in a row, the ongoing effects of Brexit and trade difficulties also reduced overseas enquiries for service companies.”