Financial strength improving in IT sector

Financial strength is returning to the IT industry at a faster rate than any other sector as stability returns to the market. According to the latest figures from Experian the IT sector had 56 insolvencies last month down from 65 for the same period last year but the strength score rose to 83.25, t

Financial strength is returning to the IT industry at a faster rate than any other sector as stability returns to the market.

According to the latest figures from Experian the IT sector had 56 insolvencies last month down from 65 for the same period last year but the strength score rose to 83.25, the highest ranked of all sectors of the market.

But despite the improvements there was a warning that things remained challenging for mid sized companies and SMEs could not take things for granted.

"Our analysis shows that it continues to be vital for businesses to understand the circumstances of those they are doing business with and the risks they could expose their company to," said Rolf Hickmann, managing director of pH, an Experian company.

Overall across the economy the number of business collapses went down by 15% but of those that were impacted mid sized companies were the hardest hit suffering the highest insolvency rates.

Hickmann said it was sometimes easier for small firms to make adjustments to avoid folding and enterprises could lean on economies of scale but "mid-sized businesses do not typically have the luxury of either of these benefits and can face the most pressure".

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