An increase in the number of new companies established in the first half of the year, combined with a reduction in the number of insolvencies are "the hallmarks of an economic recovery", according to a business risk analysis firm.
More than 8,600 companies were formed in the first half of this year, representing a 14% increase on the same period in 2013, according to Vision-net.ie. This year has also seen an overall decline in company insolvencies.
Combined, these two factors paint a positive picture of a recovering economy, according to Vision-net managing director, Christine Cullen.
“The first half of 2014 is showing that we are making progress towards an overall economic recovery, particularly with start-ups on the rise and insolvencies in decline,” said Ms Cullen.
The construction and real estate sectors experienced particularly strong growth with respective rises of 39% and 32% in 2014 start-ups.
“Most positive are the strong increases in start-ups in the construction and real estate sectors. A properly functioning construction and real estate sector is a vital part of the economy and, reassuringly, we are seeing increased business activity within this sector,” said Ms Cullen. “This is critical to meet the increased demand for new commercial and residential property and to prevent an unsustainable property bubble.”
Insolvencies dropped 10.5% in the first half of 2014 compared with the same period in 2013.
Dublin, with 43% of recorded insolvencies, followed by Cork and Galway are the most insolvent counties, according to the firm.
The social and personal services, health and social work, and leasing sectors were the only three to experience an overall increase in insolvencies in the first six months. In the first half of 2014, 72% of bad judgments were awarded against consumers at an average value of €92,000, more than double the average commercial judgment.
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