AI, Footfall, Interest Rates and Statistics

Posted on Nov 03, 2023. by NTI

Whilst Storm Ciarán swept its windy way through Southern England and the Channel Islands, as well as bringing rain and flooding to many other parts of the country, the horrific scenes in Israel and Gaza continuing and civil servants and Dominic Cummings seemingly queueing up at the Covid inquiry to tell everyone how bad Boris Johnson and Matt Hancock were (who COULD have guessed that?) you may have missed some news stories this week.  Well grab a coffee (or something stronger if you prefer) and let the newsroom take you through them.

The week began with the release of The Insolvency Service’s latest quarterly statistics for Q3 of 2023 (1 July to 30 September).  There were 6,208 company insolvencies, with CVLs as ever the lion’s share with 4,965 (a smidge under 80%).  The numbers were completed with 735 Compulsory Liquidations, 466 Administrations, 41 CVAs and just one receivership appointment.

Accounting for seasonal adjustment, the total number is 2% lower than in Q2 2023, but 10% higher than in the same months last year.  Together, the last six months have seen the highest quarterly insolvency numbers since 2009 and the highest numbers of CVLs since records began in 1960.  The numbers of Compulsory Liquidations and Administrations have bounced back to those last seen before the pandemic.

The headline in the personal sector was the number of individual insolvencies in July to September 2023 was 6% lower than in the previous three months and 15% lower than the same quarter in 2022. The number of DROs was the highest quarterly number since their introduction in 2009.  Bankruptcies also increased, but IVAs were lower. There were 23,089 Breathing Space registrations in Q3 of 2023 a rise of 26% compared to 2022.

As was widely predicted, the Bank of England held interest rates for the second successive time at 5.25%.  Andrew Bailey, Governor of the Bank said it was "much too early to be thinking about rate cuts" as the Bank predicts the UK economy is likely to see zero growth until 2025, with interest rates set to remain higher than previously anticipated for longer.  However, the Bank expects inflation to fall sharply in the coming months.   Mr Bailey also cautioned that the conflict in the Middle East had not yet had an impact on the global economy but could yet still do.

Two of PM Rishi Sunak’s pledges at the start of 2023 were to get the UK economy growing and to halve inflation to about 5% by the end of the year.  Still, as Meat Loaf almost sang, one out of two ain’t bad eh Rishi? 

The PM is obviously very happy with that ratio as he spent yesterday talking to Elon Musk about Artificial Intelligence (AI).  If Elon Musk is to be believed, then you won’t have to worry about completing RP14 and 14a forms on behalf of employees, but to get your robots to complete them on behalf of robots as the Tesla CEO predicted that AI will “make paid work redundant”.  Perhaps, given the financial chaos and poor treatment of his employees Musk has brought to X (formerly Twitter), maybe the first role to be replaced by AI could be his?

Footfall on High Streets, retail parks and shopping centres fell by 5.7% in October from a year earlier, according to the British Retail Consortium (BRC) with the blame being placed on last month's wet weather.  Shoppers were "being much more purposeful about their trips", BRC chief executive Helen Dickinson told the BBC's Today programme.

The retail sector is now in what is known as the "golden quarter", which covers Black Friday and the run up to Christmas, when many companies make the bulk of their annual profits.  In summary, Ms Dickinson said the retail market was "very volatile" and "quite a mixed picture".

In a sign that some people’s budgeting constraints may be easing, Sainsbury's has said customers are starting to switch back from discounters Aldi and Lidl.  In its latest results it announced a rise of 10% in grocery sales in the six months to 16 September, compared with a year earlier.  Sainsbury's said the sales hike was driven not just by price rises, but by the fact that shoppers were also buying more items.

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