PwC comments on its insolvency statistics for April

The latest PwC analysis of its insolvency statistics for April present a mixed message, potentially influenced by the timing of Easter. The data indicates that corporate failure rates in April were 2.5% higher than the corresponding period last year but 4.5% down on March 2025.

Smaller businesses continue to face the greatest challenges, with 98% of all insolvencies being for companies with less than £1m annual revenue. Startups also faced issues, with 15% of total insolvencies relating to companies that had been established since 2021. Administrations were 15% higher than the same period last year, Creditor Voluntary Liquidations (CVLs) are the most commonly used tool to bring a corporates life to an end representing 78% of all insolvencies.

Sector-by-sector, the fault lines are increasingly clear. Construction continues to shoulder a disproportionate burden, making up more than 16% of April’s insolvencies - a near-identical share to the same period last year and proof that supply-chain pressures and thinning order books remain unresolved. Meanwhile, the services and business support universe - the accountants, consultants, recruiters, and other firms that oil the wheels of commerce - now accounts for a quarter of all failures. As corporate clients cut discretionary spending or bring assignments in-house, many of these service providers may find their own revenue tap affected.

David Kelly, Head of Insolvency, PwC UK commented: “The timing of Easter makes any material analysis difficult. However, what remains obvious is that many businesses, especially those in the services and wider business support sectors, are facing challenges as clients reduce discretionary services spending or look to bring activities in house. Small, primarily family-owned businesses which are the lifeblood of the economy, and the engine of growth, are the most vulnerable. 

“We have seen many of these themes echoed in our recent consumer sentiment survey which has revealed that household finances are worse than last year and there is greater concern over both personal and national economic situations. This uncertainty has driven consumer spending intentions lower, and consumer cutbacks higher. Category spending intentions have declined for the first time since 2022, and there has been an increase in short-term spending reductions. Additionally, job security concerns are affecting a portion of the population, particularly among younger individuals and lower skilled workers. However, the recent positive GDP data will provide some comfort to UK businesses and point to embedded resilience in the UK economy.”