Highest Ever Number of Voluntary Liquidations in May 2023
Insolvency statistics for the period ended May 2023 show a record high of 504 Voluntary Liquidations commenced during the month.
504 is the highest monthly number of voluntary liquidations since records started back in 1999. It was a 40% increase over the same month in 2022. In fact, May 2023 is only the second month voluntary liquidations have been above 500 appointments, the last time being at the height of the delayed influence of the GFC on the insolvency industry which was June 2011 with 502.
Total Insolvencies also hit a local peak in May 2023. 866 insolvencies for May is the highest total monthly figure since November 2015. It is a 55% increase over the same month in 2022.
Small Business Restructurings continue to grow rapidly. There was a new monthly record of 57 in May 2023. That was an over 300% increase from May 2022’s 14.
Court appointed liquidation are at the highest for some time also. 128 across Australia is more than double May 2022’s number of 57. 128 court appointments is the highest since the start of the pandemic, 138 in March 2020.
State by state, New South Wales saw the lion’s share of appointments (as usual) with 384 being 44% of the national total. It also saw the largest year on year growth in insolvency appointments, May 2023 or NSW was an 82% increase over May 2022’s total of 211.
By Industry type, Construction continues to top the list with 261 appointments being 30% of the national total. This is the highest monthly number for any segment (except the catch-all “Other”) since industry type statistics started in 2013. Second place in 2023 goes to Accommodation and Food Services with 123 insolvencies, being 14% of the national total.
This spike in insolvency activity appears to be driven by an increase in debt pursuit action from the ATO. We have started to see a rise in reports of Director Penalty Notices received.