14 October 2009 | Allie Anderson
The number of UK firms going bust is falling but overall failures remain higher than in 2008, according to business information provider Equifax.
The report found that between July and September, the number of business closures in all sectors and regions dropped by 13.5 per cent compared with the second quarter of 2009. However, this was an increase of 12.9 per cent on the same period last year.
The North East of England showed the greatest improvement, with 25.5 per cent fewer businesses failing in the third quarter this year than in the second. This represented a fall of 5.6 per cent on the third quarter in 2008, one of only two regions to see a year-on-year improvement.
The other was Scotland, where the number of firms going bust fell by 15.9 per cent between July and September, compared with the same period last year.
Construction saw the steepest rise in the number of firms going bust in the past year, with 20.6 per cent more failures in the third quarter of 2009 compared with the same period last year. But this represented a 15 per cent fall compared with the second quarter of this year, an indication that conditions are improving.
Neil Munroe, external affairs director at Equifax, said: "Businesses right across the UK and across every sector [will] take real encouragement from these figures. But they must also continue to take the right precautions to protect themselves from some of the risks of these continuing difficult trading conditions.
"They need to continue to use rigorous credit checks, alongside ongoing monitoring of the financial status of their customers and suppliers."
Equifax's research echoes the findings of a separate report published last month, revealing the highest month-on-month decline in UK business failures in August (Web news, 21 September