According to the Household Finance Index 30% of people are stating their finances have worsened over the last month. It’s not just householders suffering, though: it seems both the high street and the public sector are also under the cosh.
There’s not much cause for optimism elsewhere. Take Woolworths. It may be 18 months since the much-love chain went bust, but some 40% of its former stores still remain empty. That’s 300 disused shops – many of them in prime locations. Of the ones that are occupied, it’s cheap and cheerful all the way – about a quarter are running as pound shops, while 60 stores have been bought by value food retailer Iceland.Even though the public sector spending review has yet to get properly under way, the businesses which service the public sector are already feeling the pain. The number of insolvencies of public sector suppliers has already risen by 50% this year, with 168 businesses going bust between January and June, compared to 114 in the first half of 2009 – and that’s before the cuts.And for every failed business, there are many more which are in less severe – but still serious – trouble. Some big players, too – the likes of Connaught, the social housing maintenance group, which is now in emergency talks with lenders on a possible debt-for-equity swap which could ‘wipe out’ its shareholders, and Cable & Wireless, the providers or communications services to corporations, local authorities and government bodies, which saw its shares plunge 17% in July after warning spending in the UK public sector had ‘slowed very significantly’.We have written previously about the inter-dependence between the public and private sector and if the hatchet comes out in the October spending review then 2011 will be a lot tougher than 2010.
Scary times, with unemployment set to rise again.
Author: Chris Slay
Skills Provision will allow our articles/quotes to be reproduced on other formats as long as full accreditation is given.
