50,000 companies at risk from tomorrow’s cuts
Fifty thousand companies in the sectors most at risk from public spending cuts (construction, IT, recruitment, advertising and business services) according to insolvency practitioner Begbies Traynor. The company’s latest Red Flag Alert shows that overall, there are 123,000 companies suffering significant or critical financial problems; those with critical problems have debts totalling more than £57 billion.
Although the number of companies with problems is still coming down, the company’s analysis of the statistics points to a “marked slowdown in the rate of recovery” and that the companies most likely to be hurt by government cuts are “already starting to shows definite signs of financial distress.”
Danny Alexander has leaked the news that the Comprehensive Spending Review will cost at least 490,000 public sector jobs. But it won’t stop there: as the Begbies Traynor figures hint, the private sector will be hit almost as hard.