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UK Report: Business Closures In Q2 Second Highest Since 2017 With Small Businesses Taking A Hit

The number of businesses in the U.K. that closed in Q2 was the highest since 2017 as the number hit 105,455, according to a report from the Office of National Statistics.

In 2017, by contrast, the number had reached 98,880 in Q2, which was higher than any year in between then and now.

The number in 2021 was 43 percent higher than that which happened at the same time in 2020.

The largest increases in business closures came in the categories of transport and storage, along with the professional, scientific and technical industries. The report details the facts that there was a 91 percent increase in closures for the transportation and storage industry. Meanwhile there was a 35 percent boost for professional, scientific and technical companies.

All sixteen of the major groups showed a boost in closures, though.

The business closures, according to the report, resulted in the businesses removed from the Inter-Departmental Business Register (IDBR) in the U.K. Businesses are removed from that register if their turnover and employment have been zero for several periods.

But the report notes that there was a more robust growth than usual in business closures this quarter compared to the same time in 2020, because Q2 in 2020 featured government help at that time, which likely prevented too many businesses from closing down at first.

A report from April 2021 found that many U.K. companies had reported being in some type of financial distress — the report found over 720,000 such firms, according to data reported from insolvency firm Begbies Traynor. The number was a 15 percent increase over the number from the end of 2020, along with being a 42 percent spike since the same time in 2020.

Read more: Over 720,000 UK Businesses Are Facing Steep Financial Hardship

The news was coming as the U.K., at that time, was first trying to reopen after the effects of the pandemic.

While government relief efforts had been present, many companies had become saddled with debt. Rent was also a factor.

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