The latest insolvency data released today by the Australian Securities and Investments Commission (ASIC) shows an increase in the number of Australian businesses going into insolvency in the nine-month period from 1 July 2023 to 31 March 2024. During this period, 7,742 businesses entered into external administration, an increase of 36.2 per cent from the previous corresponding nine-month period ending 31 March 2023.

Of these external administrations, the construction (2,142) and accommodation and food services (1,174) sectors had the highest number of business insolvencies, accounting for 27.7 per cent and 15.2 per cent of the total, respectively. Restructuring (878) and court liquidation appointments (1,593) increased by 294.6 per cent and 218.8 per cent, respectively, compared with the previous corresponding period. These figures are higher than those recorded in the full-year period ending 30 June 2023, which stood at 447 and 1,081, respectively.

With only one quarter remaining in the current financial year, it is expected that the number of businesses entering external administration will exceed 10,000 by 30 June 2024, which is the level since the 2012-2013 financial year.

Notably, when compared to the number of registered businesses (which is projected to be between 0.3 per cent and 0.33 per cent for the full year), the proportion of businesses entering external administration is still below the level of 2012-2013 (0.53 per cent), as the number of registered businesses in Australia has increased from just over 2 million to 3.3 million over the same period.