Ireland’s new company start-up levels reached their lowest point in four years in 2020 due to the Covid-19 pandemic, according to the latest figures from credit risk analyst CRIFVision-net.
The annual figures released today reveal that a total of 21,924 new start-ups were registered in 2020, the lowest figure on record since 2016 (21,018). This marks an overall decrease of 4% in new registrations when compared to 2019.
According to the data, the second quarter of the year recorded the lowest number of company start-ups (3,998, April–June). April 2020 was the worst month for start-ups (1,075) since December 2012 (992).
Despite the overall decrease in activity among the start-up community in 2020, there have been early signs of regrowth, with levels increasing from June (1,701).
The final quarter of the year proved particularly strong, marking an increase of 20% in new registrations compared to the third quarter. In total, 6,583 new companies were registered in the fourth quarter, a 23% increase on the same period in 2019.
The figures reveal that despite the Covid-19 economic downturn, start-ups have remained more resilient when compared to the 2008 recession where figures decreased by 22% year-on-year for 2008 (18,696 start-ups, 2007 vs 14,603 start-ups, 2008).
Of the 26 counties in the Republic of Ireland, a total of 24 recorded a decrease in new company start-ups for 2020. Leitrim experienced the largest percentage decrease, recording a total of 55 new companies in 2020, down 41% when compared to 2019. Leitrim was followed by Meath (-39%, 629), Clare (-33%, 401), and Cavan (-24%, 213). Mayo (+4%, 345) and Tipperary (+6%, 461) were the only two counties to record a percentage increase.
Commenting on the 2020 figures, Managing Director of CRIFVision-net, Christine Cullen said, "From the early stages of the pandemic, the Government was quick to provide support for SMEs and new business start-ups, introducing a range of measures that have been consistently extended and adapted in line with Covid-19 developments. While these supports have played a vital role in facilitating early recovery, the concern now is that the return to lockdown restrictions will reverse the progress that has been made so far."
She added, "The impact of prolonged closures and restrictions on businesses has been well documented over the course of the pandemic, and while restrictions are important now, we must ensure that we are simultaneously developing a sustainable environment in which businesses can recover."