During the period, July to September, the number of company insolvencies was 17% higher than in Q2 2021 and 43% higher than in Q3 2020, according to the latest national statistics.
The increase was driven by a rise in creditors’ voluntary liquidations (CVLs) which reached its peak level since Q2 2009 as the impact of Covid-19 continued to affect businesses.
The data revealed that one in 341 active companies entered liquidation between 1 October 2020 and 30 September 2021. This was a decrease from the 32.4 per 10,000 active companies that entered liquidation in the 12 months period to 30 September 2020.
During Q3 2021, there were also 3,765 (seasonally adjusted) registered company insolvencies,, comprising 3,471 CVLs, 105 compulsory liquidations, 169 administrations, and 20 company voluntary arrangements (CVAs).
Blair Milne, restructuring and insolvency partner at Azets, said: “The biggest increase can be seen in Creditors’ Voluntary Liquidations, where directors have sought to place their business into an insolvency process.
“Many businesses have yet to see a return to pre-pandemic levels of activity and are now having to navigate a myriad of challenges including rising inflationary costs, particularly utility charges, supply chain disruption, increasing labour and material costs and chronic staff shortages.”