IT business failures rise in September

Sixty-seven IT businesses in the UK went to the wall during September, according to new monthly figures from financial information services provider Experian, a sequential rise of 52% and a year-on-year spike of 24%. Overall the data show thatthe insolvency rate continues to fluctuate but has improv

Sixty-seven IT businesses in the UK went to the wall during September, according to new monthly figures from financial information services provider Experian, a sequential rise of 52% and a year-on-year spike of 24%.

Overall the data show that the insolvency rate continues to fluctuate but has improved steadily since last September, standing at 0.08% compared to 0.09% this time last year.

The North-East of England was the most gravely afflicted, with the insolvency rate rising from 0.06% in August to 0.15% in September. All other regions were saw insolvencies holding steady or increasing, apart from Yorkshire, which improved dramatically from 0.13% to 0.10%.

Large firms with over 500 employees saw the greatest year-on-year rise in insolvencies, while small firms with between six and 10 employees saw the biggest annual drop, down from 0.21% in September 2009 to 0.16% last month.

"The North East's business population is one of the smallest, so every insolvency can dramatically affect the rate, which explains why we have seen a big variation," said Max Firth, managing principle of Experian unit pH, which compiled the figures.

"This underlines why businesses must be vigilant and closely monitor the financial health of every organisation they do business with," he added.

Experian's figures came on the same day as the Office of National Statistics released quarterly figures showing that the UK economy grew faster than expected during calendar Q3.

Growth of 0.8% was down sequentially, but this countered rapid growth of 1.2% during Q2 and does not yet indicate an oncoming double dip.

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