The Australian economy has taken a severe hit as many businesses have had to close their doors due to extreme financial pressure combined with the termination of government subsidies. The number of companies facing insolvency has almost doubled over this past year, leading to an “insolvency armageddon”.
In March this year, 828 people became insolvent according to the Australian Securities and Investments Commission – a huge hike from 359 in January and 692 in February. Comparatively speaking, in the same month last year only 464 went into insolvency.
Recently, some of the most well-known businesses that have shut down are Porter Davis in the construction sector and Mahercorp. As of Friday, fine-dining food delivery business Providoor also suffered a similar fate.
In the three years prior to the pandemic, there was an average of 8060 insolvencies each year. Yet due to the pandemic, from January 2020 to September 2022, insolvencies decreased dramatically by 53%, amounting to 5259 in total.
