North East insolvencies hit nine-month high

R3’s analysis of data provided by Creditsafe shows there were 81 cases of insolvency-related activity in the North East in April – the highest monthly total since July 2024’s figure of 94, and a 24.6% increase on April 2024’s total of 65.

Insolvency-related activity, which includes administrator and liquidator appointments along with creditors’ meetings, have risen every month since the start of the year, with April 2025’s figures 6.6% higher than March’s total of 76.

Kelly Jordan, chair of R3 in the North East, said: “We’ve seen a steady increase in insolvency-related activity in the region since the start of the year, but last month’s rise to levels not seen since last summer highlights the ongoing pressure businesses are facing.

“A number of factors are likely contributing to this increase, including a rise in MVLs from directors choosing to close their businesses in response to recent tax and policy changes, such as the increases to Employers’ National Insurance and the minimum wage.

"The North East’s reliance on labour-intensive sectors like hospitality, retail, and manufacturing is also playing a role, with rising costs creating additional strain. These industries are particularly vulnerable, as tighter margins and fluctuating demand create an environment where businesses are struggling to stay afloat.

Compared with the rest of the UK, the North East saw the second highest yearly percentage increase in insolvency-related activity in April, preceded only by Northern Ireland (38.1% rise). Only the East Midlands, Greater London, the South West, and Yorkshire saw insolvency-related activity numbers fall year-on-year.

Kelly, who is a partner at Muckle LLP, continues: “Despite the current challenges, there is still a sense that many businesses in the North East are holding on, but this is creating a fragile situation. With creditors taking a tougher approach to debt recovery, businesses could quickly find themselves in a more difficult position if they don’t seek the help they need.

“My advice to businesses is simple – act early. Early intervention gives you more time to assess your options and can help you take action before those options are no longer available to you.”