Fewer NW manufacturing failures, says PwC

NORTH West year-on-year manufacturing insolvencies fell by 23% in the first quarter, according to data from the accountancy group PwC.

The number of business failures in the sector dropped from 65 last year to 50. This figure was also down on the final three months of last year when there were 57 failures.

In the past 12 months there have been 305 manufacturing insolvencies in the region.

In construction year-on-year insolvencies fell 25% from 115 in the first quarter of 2012 to 85 in the first three months of 2013. However, since the final quarter of 2012 the number of failures increased from 74, up 15%. In the past year there were 452 construction insolvencies.

Iwan Griffiths, regional industrial products lead and partner at PwC Manchester, said: “The reduction in manufacturing insolvencies in the North West is encouraging but with rising raw material costs and no imminent signs of a material economic recovery, the outlook remains tough for those companies already experiencing financial stress.”

Ian Marsden property expert and partner at PwC Manchester, said: “Any reduction in the number of insolvencies in the construction sector is welcome and so to see a drop in levels from Q1 2012 to Q1 2013 in the North West is good news.

“The sector in the UK is still experiencing declining output year on year however, so we are not necessarily over the worst yet in terms of insolvencies. There is an ongoing cash squeeze throughout the supply chain as has been evidenced in recent reported results.

“The measures in the recent budget to support infrastructure, and in particular levels of house-building  are welcome but will take a little while to feed through into output.”