Distress in Yorkshire professional services sector slows
The proportion of professional services firms in Yorkshire at higher than average risk of insolvency grew between April and May but at a slower month-on-month rate.
According to the latest research from insolvency trade body R3, this month in Yorkshire there was a rise in distress in the sector of only 1.4% since April, one of the lowest increases in the last year. With 48.6% of professional services firms in the region at higher than normal risk of insolvency, levels of distress here are now only slightly above the UK-wide figure of 47.6%.
In May, over 1,800 professional services firms in Yorkshire were in the overall negative band, out of a total of over 3,700 active companies in the sector in the region.
Looking across the UK, levels of risk were highest in Wales (51.7%) and the South East (50.7%) while the best performing of the 12 regions surveyed were Northern Ireland (43.8%) and London (43.9%).
In all, 40.1% of all UK companies were found by R3 to be at higher than average risk of insolvency in May, with Yorkshire close to this figure at 41.9%.
In a number of sectors, the region was near to the national picture: in the pubs sector 31.3% of businesses in Yorkshire were in the negative risk band (compared with 32.1% nationally); in manufacturing 35.7% (34.9% nationally); and in the hotels sector 31.7% (30.3% nationally).
“Obviously, the professional services sector is not immune to the vagaries of the wider economy, with falling confidence being felt here too,” said Eleanor Temple, chair of R3 in Yorkshire and a barrister at Kings Chambers in Leeds. “Like any business, professional services firms need to keep a close eye on their cashflow in the current challenging times.
“Overall, after growing month on month distress across most sectors throughout 2017, there is a feeling that consumers and businesses are becoming accustomed to the ‘new normal’ of Brexit uncertainty with a slowing down of distress this year, although sluggish economic growth and flatlining productivity levels present challenges across sectors and regions.”