The latest Insolvency Index from Experian, the global information services company, has revealed a positive picture in November, as the number of failing businesses continued to fall and the financial strength of businesses improved.

Businesses across Great Britain saw an improvement in their financial strength score from 79.66 in November 2008 to 81.26 November 2009.  Furthermore, the rate of insolvencies fell to 0.09 per cent in November 2009, compared to 0.11 per cent in November 2008.

Rolf Hickmann, managing director of pH, an Experian company, said: “The past four months have seen a fairly low and stable rate of insolvencies, compared to 2008, and certainly compared to the heights reached in the last recession in 1992.  In fact the overall picture shows a very gentle decline in insolvencies throughout the year.  Furthermore, the latest improvement in the financial health score is the fifth month in a row that the health of businesses has improved.


“Despite the prolonged recession, the UK’s entrepreneurial spirit continues to thrive.  The number of micro businesses, those with one to two employees, is growing rapidly.  They are enjoying amongst the lowest rates of insolvency and are relatively secure.”

Other key highlights include: 

As in November 2008, businesses in the South West continued to be the most robust, holding the best financial strength score during November 2009.
Although insolvency rates in the South East region fell from 0.16 per cent (November 2008) to 0.13 per cent (November 2009), it continues to have the highest rate of failures compared to other regions
Scotland continues to enjoy the lowest rate of business failures (0.04 per cent).
The financial strength of businesses in Yorkshire improved the most during November (from a financial strength score of 79.39 to 81.40). Yorkshire was also amongst the regions to have the lowest rates of failure.
Businesses in Greater London saw the second highest improvement in their financial health (from 78.13 to 80.13).  However, London businesses had the lowest overall financial strength score compared to other regions.
As in November 2008, the highest insolvency rates during November 2009 continued to be among businesses with 11 to 25 employees (0.24 per cent).
The smallest rates of insolvencies remained among the smallest businesses – 1 to 2 employees (0.05 per cent).
The largest businesses, with over 501 employees, continue to have the best financial strength score, but were the only types to see a drop, albeit marginal, in the score (down from 84.83 to 84.61).
The worst score in comparison to the other businesses was held by businesses with 51 to 100 employees (80.40), although they did see a small year-on-year improvement (from 80.10).
The best improvement in the financial strength score from November 2008 to November 2009 was among businesses with 1 to 2 employees.  These businesses also held the second highest score, after businesses with 501 employees.

The chemical and breweries sectors had the highest insolvencies rates during November (0.21 per cent each), followed closely by the postal/telecommunications sector (0.20 per cent). Although the postal/telecommunications sector continues to hold the worst financial strength score compared to other sectors (76.59), it was among the top three sectors to see the highest improvement in its scores since November 2008 (from 74.46).