Alarming Rise in Business Deaths Across England Signals Economic Stress Post-Covid
2023 data on business deaths and business births from the ONS reveals a worrying trend of increasing business closures across the United Kingdom, with a sharp 15.36% rise since the beginning of 2020. Meanwhile, business births – that is to say, new businesses being created – had decreased by 11.86% in the same time frame.
The Q1 2023 report compares starkly with its Q1 2020 counterpart, recording 92,715 business closures compared to 80,370, respectively. This critical development underscores the heightened economic stress and the challenging operational landscape confronting businesses nationwide.
Regional Disparities
Funding Guru can reveal that between 2020 and 2023, the West Midlands has experienced the sharpest surge in business deaths, with a staggering increase of almost 46% between pre-Covid to now.
However, other regions haven’t been immune to the escalating crisis. Yorkshire and The Humber and the East Midlands have also faced significant blows, witnessing 26.41% and 28.63% increases, respectively.
Meanwhile, the East Midlands has seen the biggest hit to new business with a decline of 17.94%.
However, contrasting these rising trends, London and the South East have demonstrated relative resilience. Both regions have seen comparatively modest rises in business closures with 7.97% and 4.27% respectively, whilst entrepreneurial in the North East appears to continue to thrive with a mere 5.52% drop in new businesses.
What does the new data tell us?
The new data indicates a difficult few years for businesses, precipitated in no small part by the pandemic and its after-effects.
The ripple effect of COVID-19 has not only affected the survival of existing businesses but has also cast shadows on the birth of new enterprises, especially in traditionally thriving regions like London. It’s evident that the economic landscape across England has shifted, with regions like the West Midlands and East Midlands bearing significant brunt.
The need for robust interventions, support systems, and innovative strategies has never been greater. As the country navigates its recovery, fostering a conducive environment for both existing and aspiring businesses will be paramount to revitalising England’s economic vibrancy.
