Insolvency Insights - Analysis of ASIC's March 2013 External Administration Appointment Statistics
After a large jump in insolvencies against prior month records for February 2013, March saw a 4.6% decline in external administrations to 918 companies for the month.
With a cumulative 2,506 companies entering administration so far for 2013, the year is slightly behind the total at March for 2012 (2,655) but well ahead of the same time for 2008 to 2011.
Unemployment continues the long rising trend of the last 12 months with the trend increasing to 5.5% from the 5.1% low. The increase in unemployment matches a prediction made by FTI Consulting in July 2012, that peak in insolvencies would flow through to an increased unemployment rate.
The multi-year mining sector boom now seems if not yet quite past its peak, certainly far closer to the end than the beginning. As a result, insolvencies in the mining services sector can be expected to rise in the coming year.
The challenge is now for the rest of the economy to pick up the slack, with the falling Australian dollar likely to spur a revival in many sectors of the economy from manufacturing to retail, as domestic production regains competitiveness against imports and overseas offerings.