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BusinessLive reports that it’s still unclear whether SA scraped by with any growth in 2019, the year’s liquidation figures reflect just how tough conditions have become for businesses.
The latest liquidation figures released by Stats SA show that the number of businesses that had to wind up their operations in 2019 increased 10.7% from the year before. This was the first increase seen in a decade since the global financial crisis, when liquidations hit 25.2%, Stats SA indicated on Tuesday. The figures show the mounting financial pressure on companies, Absa economist Peter Worthington commented. Figures for insolvencies — which are delayed and are only available to November — suggest a similarly gloomy picture. On a year-to-date basis, insolvencies between January and November increased 23% on the same period the year before. The three largest contributors to the 2,042 liquidations recorded in 2019 were finance, insurance, real estate and business services, which accounted for 32.7% of liquidations; “unclassified” businesses, which accounted for 26.4%; and trade, catering and accommodation, which accounted for 22.4%. The liquidations outcomes reflect the low levels of profitability for firms exposed to SA’s battling economy, said Arthur Kamp, chief economist at Sanlam Investments. SA’s unemployment rate is hovering at just below 30%, while business confidence continues to languish at close to 20-year lows.
- Read the full original of the report in the above regard by Lynley Donnelly at BusinessLive
- Read too, Liquidations up 10.7% in 2019 compared with 2018, at Engineering News
Get other news reports at the SA Labour News home page