THOUSANDS of Merseyside businesses closed their doors for the last time in 2021 as closures across the UK hit the highest level since 2017, new figures show.
The Institute of Directors’ corporate governance group said that while businesses are constantly opening and closing, the uncertainty caused by the coronavirus pandemic has “complicated” the business landscape across the country.
Figures from the Office for National Statistics show 6,130 businesses closed in 2021 – up from 5,440 in 2020.
It was also up from 5,295 in 2019 before the coronavirus pandemic hit.
In 2021, 327,000 businesses across the country closed – a 9% increase from the previous year and the highest number since 2017.
Kitty Ussher, chief economist at the IoD, said businesses are constantly opening and closing, particularly sole proprietors doing odd jobs – including delivery couriers, which have seen a boom during the pandemic – and self-employed people doing freelance work.
These are included in the official statistics and are more likely to be created or closed in a short period of time, Ms Ussher added.
The transportation, warehousing and postal industries had the highest business birth rate at 26% and the highest business death rate at 22%.
No other industry had a rate of over 16%.
Ms Ussher said: “The picture is then complicated by the impact of the pandemic, which not only led to a temporary spike in unemployment, thus increasing the number of people looking for freelance work, but also caused a change in consumer behavior affecting different parts of the economy in different ways.
“All of this led to particularly high churn rates as the economy adjusted in 2021.”
Ms Ussher highlighted the surge in business creation in 2021 and suggested that this shows the economy is starting to recover from the pandemic.
Across the country, 360,000 companies began trading last year — a 9% increase from the 333,000 a year earlier and the highest since 2016.
Of these, 6,905 were in Merseyside.
This means that a total of 45,890 companies were active in the region in 2021 – compared to 44,730 in the previous year.
The IoD said the majority of new and closed businesses were sole traders – of the 327,000 total business deaths in the UK last year, just 82,000 had two or more employees.
Merseyside now has around 185 high growth companies in the region – meaning annual growth in the company’s workforce over the last three years has been at least 20% – and around 4,575 companies employed 10 or more people.
https://www.sthelensstar.co.uk/news/23193019.figures-show-thousands-merseyside-businesses-closed-last-year/?ref=rss Figures show thousands of Merseyside businesses have closed over the past year