Official data reveals a significant surge in business failures across England and Wales, with experts warning that a growing number of firms are being pushed to the brink by mounting economic pressures.
A Sharp Rise in Business Failures
According to the latest figures from the Insolvency Service, there were 2,029 company insolvencies recorded in October 2025. This represents a 2% increase from the previous month and a stark 17% jump compared to the same period last year.
The data also highlighted a worrying trend for larger companies, with the number of firms entering administration rising by nearly a fifth year-on-year. This indicates that even more established businesses are not immune to the current financial distress.
Mounting Pressures on UK Businesses
Financial experts point to a perfect storm of challenges threatening corporate viability. Simon Edel, a financial restructuring partner at EY-Parthenon, described the October figures as the latest signal of the enduring effects of economic, policy, and geopolitical pressures.
He explained that many firms are still struggling to offset higher employment costs and are now bracing for potential impacts from the upcoming autumn Budget. "With persistent economic uncertainty, rising distress, and challenges like liquidity constraints, we expect insolvency to become more common," Edel stated.
A Difficult Winter Ahead
Mark Ford, a partner in the restructuring and recovery team at S&W, echoed these concerns, cautioning that businesses face a difficult winter. He cited specific cost increases that are heaping pressure on companies, including:
- Rises in employer national insurance contributions
- Increases to the minimum wage
- Higher business rates
Ford noted that many firms feel unable to pass these costs onto consumers for fear of losing customers, further squeezing their margins.
The insolvency surge is part of a broader trend, with monthly company insolvencies in 2025 consistently higher than those recorded in 2024. The data also showed a 14% year-on-year increase in personal insolvencies, with 10,552 individuals in England and Wales entering insolvency in October.
