Commenting on the Insolvency Service’s latest monthly statistics for England and Wales, R3 President, Sonia Jordan, a Restructuring and Insolvency Partner at Knights, said:
‘Businesses came under renewed pressure in July as corporate insolvencies increased by 5% month-on-month to 1,931. While the number of insolvencies was still below the level recorded a year earlier, the rise suggests many firms are still suffering from the impact of the uncertain economic environment.
‘The increase in corporate insolvencies comes against a backdrop of a mixed economic picture. Although the UK economy grew by 0.4% in the three months to June, job vacancies are at a five year low according to ONS figures, with small firms citing labour and operating costs as reasons for scaling back hiring.
‘Many companies continue to operate on thin margins and will be hoping recent government measures, including the Prime Minister’s proposed cut in business rates for pubs, clubs and live music venues, provide much-needed financial breathing space.
‘Such announcements will be welcomed by those sectors, but it will not help all of the areas where distress is most acute. Construction and manufacturing, both of which feature among the six industries with the highest insolvencies in July, will be looking to the autumn Budget for further targeted support.
‘Meanwhile, measures in the Employment Rights Act 2025, could further increase labour costs at a time when SMEs are feeling the pressure from higher wages, energy bills and borrowing costs.’
Turning to personal insolvencies, Sonia commented:
‘While personal insolvency numbers were broadly unchanged month-on-month with 11,926 people entering a formal insolvency process in July compared to 11,934 in June, the figure was 14% higher than a year ago, underlining the continued pressure on household finances.
‘Many households continue to struggle with debt and there is a clear need for effective support and breathing space. Government support such as the £150 energy bill discount and the freeze on bus fares will provide some relief. Recent figures showing a decline in mortgage arrears and repossessions are also encouraging, but financial pressures remain.
‘The forthcoming review of the personal insolvency framework provides an opportunity to help people achieve a fresh start more quickly while promoting responsible debt management. Providing such support will in turn help to strengthen consumer confidence and responsible spending.
‘In the current circumstances, individuals and business owners should seek advice as soon as financial concerns arise. There are options available, but the earlier people speak to a qualified R3 adviser, the better outcomes for them.’
What the latest insolvency stats show
Corporate insolvencies in July 2026 increased by 5% compared to the previous month, with 1,931 cases compared to 1,847 in June. July’s figure was 5% lower than the same month in 2025, when there were 2,031 cases.
Personal insolvencies remained broadly stable in July 2026 compared to the previous month, with 11,926 people entering insolvency compared to 11,934 in June. Personal insolvencies were 14% higher than in July 2025, when the figure was 10,454.
