Business news 14 December 2022

James Salmon, Operations Director.

Corporate restructuring specialists expect bankruptcies to increase. Inflation. Real wage growth falls as unemployment increases. 400k working days lost to strike action in October. Cost concerns delay retirement plans.  And more business news.

Corporate restructuring specialists expect bankruptcies to increase

Insolvency specialist Begbies Traynor said it expects demand for its corporate recovery services to increase next year as a looming recession sparks an increase in bankruptcies. Ric Traynor, executive chairman, said: “We expect continued growth from business recovery and financial advisory, given its increased order book, higher level of enquiries and increasing economic headwinds.”

Elsewhere, FRP Advisory chief executive Geoff Rowley said the firm’s restructuring team expects to see an increase in demand “stemming from the many challenges faced by UK businesses.” Data shows that insolvencies surged in the 12 months to the end of September, hitting 20,731 in total – 23% higher than in the comparable pre-pandemic period.

With rising insolvencies, are you credit checking your business customers who buy on credit?

Are you on top of any overdue accounts?

If you need assistance with this, CPA can help. We have been prompting punctual payments and helping members minimise credit risk for over 100 years.

Breaking news – inflation – more to follow tomorrow

UK Inflation cooled off from last month’s record annual high, according to data from the Office of National Statistics. The consumer price index rose by 0.4% in November against the previous month. Annually, CPI grew by 10.7%. Both the annual and the monthly increases undershot market consensus of 0.6% and 10.9% rises, respectively.

Crypto

US prosecutors in New York charged Sam Bankman-Fried, the former boss of Crypto exchange FTX, with eight crimes, including wire fraud and money-laundering. At a congressional hearing he was accused of ‘old-fashioned embezzlement’.

Real wage growth falls as unemployment increases

October saw the second largest fall in real wage growth since records began in 2001, according to Office for National Statistics (ONS) data. While regular pay grew by 6.1% in the three months to October, when taking rising prices into account, wages fell by 2.7%. The ONS data also highlights the gap between public and private sector wage growth over the three months to October.

For public sector workers, the average annual rate of wage growth came in at 2.7%, while private sector staff saw an average increase of 6.9%. These both fail to match inflation, which hit 11.1% in October. The 4.2% difference between pay growth in the public and private sectors is just below the 4.4% gap seen between July and September.

October also saw the unemployment rate rise to 3.7%, up from 3.6% the month before. Vacancies fell by 65,000 in the three months to November to 1.9m, with this the fifth consecutive quarterly fall and the first annual fall since the beginning of 2021.

While KPMG expects unemployment to rise to 5.6% by mid-2024, the Bank of England expects the jobless rate to peak at 6.5%. The number of people deemed economically inactive – those who are not looking for a job – fell by more than 70,000 over the last quarter, driven by older people leaving retirement and flowing back into the workforce.

400k working days lost to strike action in October

Office for National Statistics (ONS) figures shows that more than 400,000 working days were lost to strikes in October, with this the most recorded in any month since November 2011. This comes as workers across a number of sectors withdraw their labour in a bid to force employers to grant inflation matching wage increases. The ONS said 417,000 working days were lost to strikes in October, while more than 1.1m working days were lost between June and October.

Cost concerns delay retirement plans

Analysis by Legal & General suggests that more than 2.5m over-55s plan to delay retirement as a result of the cost-of-living crisis, with up to 1.7m of these saying they expect to have to keep working indefinitely. On average, over-55s expect to stay in work for an extra three years. Nearly two-thirds of those polled said their main reason for the delay is that they would not be able to afford the loss of income while living costs are so high.

Lorna Shah of Legal & General comments: “While many people choose to retire later because they enjoy their work, there are millions of people who are making this decision based on necessity, rather than a personal choice.” Separate research from Standard Life shows that more than a third of retired women over the age of 65 and 18% of men have returned to work.

Bailey warns against ripping up City rulebook

Bank of England governor Andrew Bailey has questioned Government plans to rewrite the financial services rulebook, warning that the regulatory issues which contributed to the global financial crisis have not gone away.

Ministers are looking to tweak regulation in a bid free up the City to be more competitive, with EU-era Solvency II regulations set to be changed and ring-fencing rules for retail banks facing reform. However, Mr Bailey said he would “caution that the notion we’re past the financial crisis, and we therefore don’t need the regulations that we had post the financial crisis, I would not go along with that view.”

City minister Andrew Griffith recently said the world had “moved on” from the financial crisis, saying banks have much more capital, lending practices are tighter, there is no longer excess mortgage lending such as that seen prior to 2008, “and the Bank of England has a resolution regime that means if banks get into difficulty there’s a way out of that.”

Temp workers urged to claim holiday pay

Britain’s 1.6m temporary workers have been urged to claim an estimated £97m worth of unclaimed holiday pay from employment agencies and umbrella companies engaging them. IWORK, a support group for independent workers, has flagged that many of the UK’s flexible workforce are missing out on their statutory right to paid holiday every year. The group said that if 2% of the UK’s temporary workers are missing out on a £3,000 annual holiday pay entitlement, based on an average annual salary of £26,000, £97m is being unclaimed. IWORK founder Julia Kermode said: “£97m is a staggering figure, but in reality, it’s very likely just the tip of the iceberg.”

Why should you become a CPA member!

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for some time to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers.

Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the debt value maybe!

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.

When you see your money come in, you will be so glad you used CPA.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

 

Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!

If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA for purchase on recourse?

CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.

Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.

Just call  020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email debtpurchase@cpa.co.uk today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.

 

Get compensated for previous late payments

Have you been paid late by business customers in the last six years?

Maybe you no longer work with them. Under legislation, you are entitled to  compensation you for those late payments you have suffered.

You put up with the PAIN – now claim the GAIN!

Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!

CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients

Check our compensation calculator to see how much your business could be owed!

Discover NOW the potential value of late payment compensation hidden in your sales ledger!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.