Data reveals entrepreneurs holding back amid political uncertainty

R3’s monthly analysis of regional start-up data showed a sharp decline in new businesses in the region last month.

The Midlands branch of the national insolvency and restructuring trade body R3 used data from business intelligence provider Creditsafe, which shows that local entrepreneurs are hesitant to face economic challenges and political uncertainty before the July General Election.

R3’s data reveals that 2,076 businesses were set up in the East Midlands in May, a 42.32% decrease from the 3,599 new businesses registered in April. The May figure is also 14.29% lower than the 2,422 start-ups recorded in May 2023.

R3 Midlands Chair Stephen Rome, a partner at local law firm Penningtons Manches Cooper, said: “The sudden and steep decline in entrepreneurship in the region is reflected across the whole of the UK and highlights the effect that continuing economic challenges and uncertainty have on entrepreneurs as they seek to minimise their exposure.

“The political uncertainty caused by the impending General Election, as well as longer term economic challenges, such as inflation, contracting economies and spiralling fuel, energy and wage costs, are taking effect.

“R3’s advice to any director worried about the viability of their business, start-up or otherwise, is to seek professional help and to do it as soon as possible. The sooner support is sought, the more opportunities there may be to assure a company’s survival and future success.”