Wage rises come too late to halt insolvency spike
By Andrew Merrell | 2nd May 2018
It is not just retail on the high street which is suffering significant blows.
We hesitate to mention it - after all, there is little cheery to say - but figures show the underlying personal insolvencies have hit a near six-year high.
On top of that the rate of corporate failures are at their highest level since the first quarter of 2014.
The reasons given for the situation on the high street are now well known - weak Christmas trading, bad weather and slow wage growth.
Figures from the insolvency service for the first quarter show the number of businesses closing rose by 13 per cent on the previous quarter.
Year-on-year the figure of 0.6 per cent does not sound quite so dramatic.
According to analysts this spike is in a large part due to the crackdown on personal services firms used to reduce tax bills for contractors.
However, in an effort to find the silver lining in the tale try this for size - insolvencies remain relatively low by historic standards.
The majority of the insolvencies were apparently individual voluntary arrangements, something usually associated with consumer debt.
Bankruptcies, something usually associated with more serious debt, also rose. High profile business failures this year include Carillion, Toys R Us and Maplin.
Experts say while wages are starting to pick up the rise has come too late for many.
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