Fallout from the Budget and rising overheads have driven up this month’s corporate insolvency figures, with struggling businesses set to face further challenges in 2025 when wage costs increase.
This is according to the Midlands branch of insolvency and restructuring body R3 and follows latest statistics published by the Insolvency Service which show that corporate insolvencies in England and Wales increased by 12.8% in November, with numbers rising from 1,743 in October to 1,966 last month.
R3 Midlands Chair Stephen Rome, a partner at law firm Penningtons Manches Cooper in the region, said: “These figures remain significantly higher than those seen both during the COVID-19 pandemic and between 2014 and 2019.
“After years of rising outgoings and falling margins, businesses are facing further increases in wages as a result of the Budget, and this could be an expense too far for some firms.
“R3 Midlands members are telling us that enquiries have increased over the last month, with business owners looking to restructure or have early conversations about their financial concerns or their insolvency options ahead of the new year.
“This kind of activity won’t be reflected in the current set of insolvency statistics, but it provides an insight into the mood, challenges and concerns of the local business community as we come to the end of another difficult twelve months.
“As we head towards 2025, we urge anyone who is worried about finances to seek advice as soon as they possibly can. Discussions with a qualified advisor at the earliest possible opportunity will provide more options for improving the situation and more time to take a decision about the next step.
“Most R3 members will give prospective clients a free initial consultation so they can learn more about their circumstances and outline any potential solutions for improving them.”
