Business failures averaged over 2,000 for the first time since the peak of the 1990s recession and only the second time on record, according to RSM Tenon, the turnaround, restructuring, recovery and insolvency specialist.

Business failures during the last three months of 2009 exceeded figures from the previous quarter by 38%, with those businesses relying on discretionary spending particularly affected. Statistics from RSM Tenon Tracker show that the retail and hospitality sectors accounted for 11% of business failures in the last three months.

Although the fourth quarter was only slightly up on totals from the same period in 2008, there is a huge rise of 36% compared to 2007, showing the extent of the impact that the banking crisis has had on British businesses.

Sandy Kinninmonth, Director of Recovery at RSM Tenon in Southampton, said:

“The business landscape has changed considerably since the collapse of Lehman Brothers in September 2008, with more businesses failing than ever before and little sign of a quick or easy recovery.

“Despite GDP figures signaling an end of the recession, we expect record levels of business failures to continue through the first quarter of 2010 with as many as 7,500 insolvencies. In fact, the number of business failures for the whole of 2010 could exceed last year’s record totals by up to 20% as the recessionary sting in the tail continues to bite businesses further.”