Hospitality and retail to drive record insolvencies, says CEBR
Published: 09:32 05 Feb 2024 EST
Hospitality and retail businesses are some of the most likely companies to become insolvent in 2024, the Centre for Economics and Business Research (CEBR) said.
Construction companies typically bear the brunt of administrations, but the CEBR revealed both the retail and hospitality sectors saw similar levels of insolvencies in 2023.
For most of 2024 and 2025, the CEBR believes insolvencies will be a result of companies finally falling victim to financial injuries suffered during the pandemic.
With a large portion of hospitality and retail companies having been forced to shut throughout the pandemic, the CEBR thinks “it’s not surprising” that the industries are suffering now.
Corporate insolvency forecasts for 2024 were upped from 28,000 to 33,000 on Monday after industry data revealed levels had risen faster than expected in the last quarter of 2023.
In September, it was predicted that 7,000 companies would become insolvent in every quarter of 2024.
However, analysts at the economic consultant tweaked this guidance after it was found that over 7,000 businesses had already gone into insolvency in the last three months of 2023.
Even if insolvencies were to slow and fall back down to the original 28,000 mark, 2024 would represent the highest level since comparable records began in 2013.
However, the CEBR noted that insolvencies in the 1990s would have been higher.
