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28th January 2021


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2 in 5 Administrations in construction or services leads to South East decline

Businesses in the South East of England are under increasing pressure with the region suffering from an acceleration of administrations over the past year. The South East (excluding London) and East Anglia have seen an increase in administrations of 32% and 41% respectively, year on year (Q1 2010 to Q1 2011).

Sectors particularly hard hit are service sectors at 30% and construction at 22% increases. The last year has seen a specific squeeze on these sectors as contracts decline or cease altogether and more services are taken in house. Combine this with the harsh weather conditions of the winter of Q4 and tightening of consumer spend post Christmas it has been a tough market in which to operate.

Overall administrations fell 8.2% across England in Q1 2011 compared to the same period in 2010, the figures reveal. However, despite this fall individual regions relative performance has been extremely varied. 

For example, North East and Yorkshire and Humberside and the Midlands have seen a decrease of 31%, 20% and 10% respectively.

"These figures show a reversal in fortunes when comparing the North and South in previous quarters," says Matt Haw, partner at Baker Tilly Restructuring and Recovery. "However, it may be too soon to say whether this is an emerging trend. Traditionally the South East is the first to recover alongside London as the Services sector is strongly predominant in the region.

"Q1 is typically a challenging time of the year for many businesses. Combined with other challenges, the 0.4% decline in GDP indicates further unforeseen pressure on the economy."

Matt Haw says: "Less surprising is that the retail sector has struggled as Q1 brings tougher conditions post Christmas, such as less spending power and tighter household budgets."

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21st April 2011

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