Business failures up 8.5 per cent in first quarter
More evidence of the UK's stuttering economy has been provided with news that business failures rose 8.5 per cent in the first three months of this year.
Banks tightening their lending was deemed to be a major reason for firms closing rising for the first time in over a year.
Figures from Experian show 4,798 businesses failed in the first three months of 2008 with failures recorded in 15 out of the 34 sectors monitored.
"These figures are hugely significant, highlighting the impact the continued credit crunch is having on businesses across the UK," said Tony Pullen, managing director of Experians Business Information division.
"Its the first overall increase in failures that weve seen for 12 months and demonstrates the nervousness there is in the economy."
Failures were particularly noted in agriculture (up 109.1 per cent), banking and finance (up 36 per cent), food retailing (up 35.9 per cent) and textiles and clothing (up 29.8 per cent).
Across the country, the East Midlands and Northern Ireland bore the brunt of closures, with the number of firms hitting the wall increasing by over 50 per cent.
The north-west, north-east and East Anglia all recorded business failure rates up over 20 per cent.
Mr Pullen added: Company failure has far-reaching consequences for the broader economy and peoples livelihoods.
"Failed companies expose their suppliers to bad debts, which could push some creditors into insolvency themselves.
"A sharp increase in payment times should set alarm bells ringing. This doesnt just apply to new customers. The majority of bad debts come from long-standing customers so regular monitoring of the payment trends of your most important customers can mean the different between failure and survival through these very difficult times," he concluded.