Business News Round Up (31/10/2023)
See more of the latest trends and top business news.
‘Marked increase in financial distress’ across Scottish sectors
Continuing pressure from high interest rates, alongside rising costs, is leading to growing numbers of businesses in Scotland experiencing either early or advanced financial difficulties. That’s according to the latest Red Flag Alert from Begbies Traynor, which found that during the third quarter there was a 23.3% rise in levels of Scottish businesses seeing ‘critical’ distress since the previous quarter – and a 12.1% uplift compared with the same time last year. This type of more severe distress saw more than 1,780 businesses in Scotland facing financial problems. Looking at early or ‘significant’ distress, in Scotland, there was a quarter-on-quarter increase of just under 10% to more than 22,830 businesses. This type of distress – which refers to businesses showing deterioration in key financial ratios and indicators, including working capital, contingent liabilities, retained profits and net worth – also rose by 5.8% since the same period the previous year. Across the UK, critical business distress increased by 25% on the previous quarter and by almost 2% year-on- year, to affect 37,722 firms nationally. Almost half a million companies (478,176) nationwide saw incidences of significant distress rise, with an uplift of 8.7% quarter-on-quarter, and by 4.7% year-on-year.
https://www.insider.co.uk/news/marked-increase-financial-distress-across-31321522
Number of North West firms in ‘significant’ financial distress rises
The number of North West firms operating on the brink is now close to50,000, according to new data released today by Begbies Traynor, as business challenges mount up for SMEs. In the third quarter of 2023, the number of firms in the North West operating in ‘significant’ financial distress was 49,856 according to the research. This is a year-on-year increase of 7.43 per cent (up from 46,408) and a quarterly jump of 9.38 per cent (up from 45,579). This latest data is sourced from the Begbies Traynor Red Flag dataset which tracks key factors behind company distress and failure rates. ‘Significant distress’ refers to businesses showing deterioration in key financial ratios and indicators including those measuring working capital, contingent liabilities, retained profits and net worth. The professional services sector in the North West region saw a remarkable leap in distress of almost 30 per cent (29.49 per cent) as advisory firms feel the effects of distress in other sectors of the regional economy. The largest volume of distressed businesses are found in a trio of key economic sector hubs in the North West region: construction, real estate and support services which, together, make up 41 per cent of the total (20,523) number of significantly distressed firms.
Data reveals the areas set to benefit the most from green jobs increases in years to come
Research by ecological consultancy Arbtech has revealed the areas of England set to gain the most green jobs between 2030 and 2050. The study used information from local governments to establish the places set to proportionally see the largest increases in green jobs in the relevant period. Selby is projected to see the second-largest proportional increase in green jobs. Approximately 3,000 jobs in low-carbon electricity, 1,500 in alternative fuels, and 2,000 in low-emission vehicles and infrastructure are part of a total increase of close to 6,500 green jobs in the area. Per 10,000 residents this is approximately 800, the second-highest figure in the country. In Ryedale, 1,000 jobs in alternative fuels are part of a boom that sees 285 new green jobs per 10,000 residents, the eighth-greatest proportional increase in England. South Ribble is the area of the country set to gain the most green jobs per capita between 2030 and 2050. Approximately 14,500 extra green jobs are set to befall the area in this period. About 6,000 of these are in the field of low-carbon electricity, and around 6,500 relate to low-emission vehicles and infrastructure, while more jobs fall into other categories like low-carbon heat, alternative fuels, and energy efficiency. The total increase in South Ribble is equal to 1,463 per 10,000 residents, the highest proportionally in England.
Recruitment intentions rise, despite fall in NW business confidence
Business confidence in the North West fell four points during October to 34%, according to the latest Business Barometer from Lloyds Bank Commercial Banking. Likewise, companies in the North West reported lower confidence in their own business prospects month-on-month, down three points at 42%. When taken alongside their optimism in the economy, down four points to 26%, this gives a headline confidence reading of 34%. North West businesses identified their top target areas for growth in the next six months as evolving their offer (57%), investing in their teams (48%) and entering new markets (33%). The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide. Despite lower optimism in the overall economy, a net balance of 37% of businesses in the region expect to increase staff levels over the next year, up 14 points on last month. Overall UK business confidence rose three points in October from 36% to 39%, and firms’ outlook on the overall UK economy increased four points to 34%. Businesses’ confidence in their own trading prospects also continued the upward trend, rising four points to 45%. Companies’ hiring intentions reached their highest level since May last year, with 32% of firms intending to increase staff levels over the next 12 months, up six points month-on-month.