Company financials service Duedil has analysed five million businesses over a period of 11 years and finds that in late 2008 the number of companies closing ‘exploded’.
New research finds that the period towards the end of 2008 saw seven consecutive months of negative growth and experienced a contraction of 200,000 companies.
Damian Kimmelman, CEO of Duedil, says that hundreds of thousands of businesses closed and ‘more than a million people’ lost their jobs as a result.
The findings show that Northern England was the worst hit, with 10 of the 20 worst affected cities in the UK since 2008 located in the North West and Yorkshire regions.
For closures, 2009 recorded the highest number of company closures ever, at 492,000, compared with 312,000 in 2008, the second highest year.
Duedil’s survey finds that the likes of Leeds, Birmingham and Liverpool suffered ‘heavy losses’ in the size of its business populations.
The manufacturing and heavy industry sector was hit the hardest, Duedil finds, contracting in size by over 4 per cent in 2009 after experiencing eight consecutive years of growth.
However, during 2011, the UK experienced growth in the number of companies in 2011. The business community grew by 180,000 in 2011, double that seen in 2010 and far removed from 2009 when a net loss of 127,000 was recorded.
The healthcare, legal services and education and public services sectors are leading the way in growth, the new statistics show.
Duedil has mapped the progress of British businesses and has revealed that while the years since 2000 have seen an unprecedented number of companies shut up shop, the total number of active businesses in the last ten years has increased by 56.9 per cent to 2.94 million.
Since 2000 the healthcare sector has posted growth of 248 per cent, while legal services and education and public services recorded increases of 213 per cent and 136 per cent respectively.
The research is important, Kimmelman says, in order to find out where the UK stands in terms of its recovery.
‘The best way to recovery is to understand where you are along that line. We act in different ways when we think we have recovered,’ he explains.
Kimmelman compares acting before an economic revival is complete to restarting exercise before an injury has sufficiently healed, putting unnecessary strain on a weakened entity.