More than 1000 business startups crumple due to COVID-19

Syed Umarullah HussainiWeb Editor

14th Oct, 2020. 09:33 am
Business Startups

The rising number of coronavirus cases in the United Kingdom has severely affected the business community, resulting in a loss of billions since the lockdown.

The situation in the country got more grave after more than 1,000 of the UK’s high-growth businesses filed for administration, liquidation, or dissolution.

During this period, September brought a record number of filings — the highest monthly figure in 10 years – as the full impact of COVID-19 started to be revealed.

273 fast-growth companies filed for administration, liquidation, or dissolution in that month alone, out of a total of 1,067 since the beginning of lockdown.

This makes a 181 percent month-on-month increase compared with August.

Although the government schemes provided valuable support to the companies struggling from the COVID-19 crisis, however the sharp rise in startup deaths highlights the fading preservative effect of government support schemes.

Earlier this year, the UK government announced a £1.25bn ($1.53bn) package of support for startups and tech businesses struggling as a result of the COVID-19 pandemic.

Jobless Rate in the UK

On the other hand, the jobless rate in the United Kingdom has jumped to 4.5 percent in three months even before the end of the government’s broad coronavirus job protection plan.

The economists had projected a 4.3 percent rise in the jobless rate, however, the data showed a more grim situation in the UK.

The rate was 0.6 percentage points higher than a year earlier and 0.4 percentage points above the previous quarter.

An estimated 1.52 million were unemployed in three months. That was an increase of 209,000 from a year earlier and 138,000 above the previous quarter.

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