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Worst hit industries now on the rebound

Monday, September 01 10:08:01

Industries most impacted by the economic downturn have shown continued signs of improvement in August 2014, according to the latest figures from Vision-net.ie.

Industries like manufacturing experienced 50pc fewer insolvencies compared to August last year, while in the motor industry there were no insolvencies during August 2014.

However, overall insolvencies across all sectors increased by 19pc in August when compared with last year - there were 108 compared to 91 the year before.

The figures show that 45pc of company insolvencies were recorded in Dublin, followed by 19pc in Cork and 6pc in Galway. Leitrim, Offaly, Laois, Sligo and Westmeath experienced no insolvencies during August.

More encouragingly, growth in the number of company start-ups continues to remain strong. 983 new companies have been formed in August - a figure up 8.4pc on the same period last year. This amounts to an average of 38 company start-ups every day this month.

As is the case with falling insolvencies in recession-hit sectors, start-up figures for industries badly affected by recession are also experiencing positive growth.

Construction company start-ups, the fourth most prolific industry, grew 30pc on the same period last year (63 to 82). The number of finance company start-ups also grew with 53 companies started compared to 21 last year; in addition real estate start-ups increased with 44 in August 2014 compared to 31 in August last year. The professional services; wholesale and retail; and IT industries were the three most prolific in August 2014, accounting for 46pc of company start-ups. In terms of bad debt judgments for the month of July, a total of 390 were awarded against consumers and companies, worth E33 million. 79pc of judgments (310) were awarded against consumers, totalling E30.7 million, or 93pc of the overall value of all judgments awarded.

While the number of judgements awarded against companies and consumers, year-on-year fell by 19pc, the overall value of the judgements increased by 22pc.

Christine Cullen, Managing Director of Vision-net.ie, said that August's figures were "good news for industries hit particularly hard by the recession".

"The sectors which experienced a marked decline in business during the recession, particularly construction, real estate and manufacturing are beginning to show signs of recovery. A pick-up in these key sectors is good news and critical to Ireland's continued journey back to growth. The increase in finance company start-ups is also encouraging, and may be indicative of greater liquidity in our lending market, particularly in the mortgage market," said Ms Cullen.

For more, visit: www.businessworld.ie