A report by financial analysis firm Experian states that 2005 was marked with an increased level of company failures, as indicated by a jump in corporate insolvencies up 11% from the previous year’s levels. This increase has been attributed to rising interest rates, a slowdown in consumer spending, high energy costs, and increased difficulty in going through the bureaucratic processes.
Experian came up with this analysis by taking into account the number of adverse notices that Companies House issued to these companies, such as voluntary liquidations, compulsory liquidations, administration orders, receiverships and voluntary arrangements. Such adverse notices are usually indicative that a company is expected to face difficulty in recovering to normal status in the future, if ever at all.
According to the study, the sectors most severely affected were non-food retail, business services, and media.