Rising Business Insolvency Rates: Which Sectors Are Most Affected in 2024?

The UK economy has seen significant turbulence in recent years, and, with the ongoing challenges of inflation, rising interest rates, and global supply chain disruptions, many businesses are struggling to stay afloat. As a result, business insolvency rates have steadily risen, with some sectors facing more intense pressures than others. This blog explores the reasons behind the rise in business insolvencies, identifies the sectors most affected, and provides advice for business owners seeking solutions during these difficult times.


Business insolvency occurs when a company can’t meet its debt obligations as they fall due. In 2024, UK business insolvency rates have surged as companies across various sectors face financial challenges. High operating costs, supply chain disruptions, and a tough economic climate have created significant hurdles. 


Persistent inflation, rising energy costs, and increased wage demands are straining businesses, especially those with slim profit margins. Furthermore, higher interest rates set by the Bank of England have raised borrowing costs, making debt servicing unmanageable for many companies and driving them towards insolvency.



Rising insolvency rates across these industries are driven by several factors. Economic instability, high operating costs, and supply chain disruptions have created a perfect storm for struggling businesses. Rising interest rates and inflation have made it harder to service debt or secure new funding, pushing many companies toward insolvency. Plus, shifting consumer habits and the digital transition have further challenged traditional business models.


Rising Business Insolvency Rates in the United Kingdom

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