The latest research from Begbies Traynor, the independent insolvency firm, concluded that business distress has continued to rise in Yorkshire, increasing by 1 per cent in the last quarter of 2019 compared with the same period in 2018.
The latest quarterly Red Flag Alert data, which monitors the financial health of UK companies, shows that a total of 29,520 firms in Yorkshire were in “significant” financial distress compared with 29,088 firms in Q4 (the fourth quarter) of 2018.
Since the EU referendum in June 2016, when 22,161 companies were suffering financial problems, the number of distressed businesses in the region had risen by 33 per cent.
Julian Pitts, regional managing partner for Begbies Traynor in Yorkshire, said: “Although the general election has lifted some of the political uncertainty that has held back business and household spending, the long term picture for the economy looks set to be one of relative weakness.
“The creeping tide of business distress that we are experiencing is extremely worrying, particularly across the region’s service sectors, which have traditionally been dominant and resilient industries.
Mr Pitts added: “For already hard pressed smaller businesses, rising debt levels can often be the final straw that leads to more serious problems.
“The best advice for SMEs in the current economic climate is to keep a very tight control on cash flow and to seek advice sooner rather than later if they are experiencing financial problems.”
Red Flag Alert has been measuring and reporting corporate financial distress since 2004, and has become an industry benchmark.