Number of UK IT firms opting for insolvency declines

Any green shoots?

The number of UK IT firms that have collapsed as a result of the recession has declined, according to research by information services firm Experian.

Overall, the UK's business failure rate dropped to its lowest level since September 2008.

During August, Experian's study shows a failure rate of 0.09 per cent, an increase of 0.01 percentage points on last year's figure, but significantly lower than July's 0.11 per cent.

IT firms showed a near five per cent decline in the number of business failures, compared with the August 2008 figure, with the insolvency rate of 0.05 per cent being below the UK average of 0.09 per cent.

The data was unveiled as part of the launch of a new monthly Insolvency and Distress Index by marketing analytics firm pH, acquired by Experian in 2007.

pH managing director Rolf Hickman said: "Although it is too early to tell whether this is an indication of a more positive outlook, one thing is for sure: businesses are distinctly aware of the current environment and the need to be cautious in any business dealings."

Hickman said pH had seen a significant increase in businesses monitoring the health of suppliers, customers and partners, as well as themselves, "to ensure they do not suffer from the impact of another business becoming insolvent.”