August saw highest number of companies collapsing this year, data shows
August saw the highest number of insolvencies this year as nearly 100 companies went into administration amid worsening financial pressures.
Businesses have been grappling with higher costs and steeper energy bills in recent months, worsened by the Russian invasion of Ukraine which began in February.
New analysis showed that 99 companies went into administration in August, a 41% increase compared with the same month last year.
It brings the total number of companies going bust to 522 since the beginning of the year, according to analysis by global risk and financial advisory company Kroll.
The construction sector has seen the highest number of insolvencies this year, with 87 companies handing over the reins to an administrator.
David Fleming, UK Head of Restructuring at Kroll, said: “As conditions grow harder for businesses to thrive, the economic health of the UK companies will be monitored closely to assess the impact on consumers and the economy.
“Despite this, we still expect to see a lower number of administrations than originally envisaged this year due to the continued support afforded to businesses through COVID loans, rate reliefs, and support from creditors.
“The increase in the number of businesses across retail and leisure and hospitality entering administration might indicate a slowdown in consumer spending confidence, however the new energy price cap may encourage renewed growth which could see these numbers begin to slow.”
The total number of administrations in 2022 remains below pre-pandemic levels, Kroll added, which averaged 119 a month by August 2021.