In a challenging environment amid spiralling inflation, the global energy crisis and political uncertainty in the UK, Yorkshire and the Humber saw a bright spot on the horizon with the number of business start-ups registered in October 2022 rising by 16.2% compared with September – the highest month-on-month increase of any region in the UK.
The research from insolvency and restructuring trade body R3, which is based on analysis of data provided by CreditSafe, shows that in October, 4,590 new businesses were launched in the region – 640 more start-ups than in the previous month. This makes October the month with the highest number of new businesses in Yorkshire since May (4,953), with only September (3,950) seeing the number dropping below 4,000.
While the region outperformed the UK as a whole, which saw an 8.4% rise from September to October and the addition of over 64,000 start-ups, all 12 regions and nations surveyed showed a month-on-month increase in the number of new businesses.
The regions and nations experiencing the strongest uplift in start-ups were West Midlands (up 14.1% since the previous month); Wales (up 11.7%) and the North East (up 11.5%); and the East Midlands (up 10.9%). The regions seeing the least increase in new businesses were Northern Ireland, Scotland and Greater London (up by 3.7%, 4.8% and 6.1% respectively).
The research also showed that numbers of businesses in Yorkshire and the Humber experiencing insolvency-related activity again saw a slight decrease last month, falling from 232 in September to 216 in October – a drop of 6.9% and the lowest figure since January.
“There’s no doubt that businesses are more likely to thrive in a stable economic and political climate, so, given the turmoil of recent months, it is particularly encouraging to see entrepreneurs in the region and across the UK having the confidence to launch new ventures,” comments Eleanor Temple, chair of R3 in Yorkshire and a barrister at Kings Chambers in Leeds.
“Despite the wave of negative news, it is important that businesses are able to spot market opportunities and commercialise innovative ideas.”
However, other indicators of business distress indicated a worsening of the situation in the region with late payment of invoices continuing to edge up, rising from 51,962 in September to 52,154 companies in October which had been unable to meet their payments on time. With an average invoice value of around £10,750, there were over 825,900 unsettled invoices on the books of firms in Yorkshire and the Humber last month.
Eleanor Temple continues: “While many businesses are likely to continue to prosper regardless of the current bleak economic picture, for others, the ongoing energy crisis, together with falling consumer spending, could simply place too much pressure on them. As ever, its vital that directors seek advice from insolvency professionals at the first signs of trouble when the most options will be available to support the business and prevent problems from escalating.”