Insolvency rate among UK's biggest firms halves, boosting growth and employment hopes

The rate at which large UK businesses went into insolvency more than halved last month, spelling good news for workers' employment prospects and job security.

New figures show only 0.08% of firms with more than 500 employees went into insolvency in October, compared to 0.2% during the same month in 2012, potentially helping to protect thousands of jobs.

Experts say the trend reflects a growing confidence among businesses that could lead to expansion, growth and further recruitment opportunities.

The latest Business Insolvency Index compiled by global information services company Experian shows that the building industry has also seen slightly fewer insolvencies, with a rate of 0.14% seen in October compared to 0.15% 12 months earlier.

The news means the insolvency rate in the construction industry has now fallen, year-on-year, for 12 months in a row, helping to build a platform for future growth.

Max Firth, the managing director of Experian Business Information Services for the UK and Ireland, said: "The positive trends from October are coming from some of the UK's largest sectors and biggest firms which is a good indicator of things to come.

"We are seeing a greater level of confidence among businesses than this time last year which in turn may lead to expansion and growth.

"Although this can bring increased risk exposure, getting an in-depth picture of the financial health of potential clients will help business make the best decisions and identify the best opportunities."

The index shows that on a regional basis Yorkshire fared the best with its insolvency rate falling to 0.11% last month, compared to 0.14% in October 2012.

At 0.12%, the North East had the highest insolvency rate last month, although the rate there has fallen from 0.13% in October last year.

Experian provides data and business analysis tools to firms around the world, helping them to manage their credit risk, stop fraud, improve decision making and take advantage of marketing opportunities.

Copyright Press Association 2013