The latest “Red Flag Alert” report from Begbies Traynor has revealed a 78.0% year-on-year increase in ‘critical’ financial distress. As of 30 September 2025, 55,530 companies were in ‘critical’ financial distress, a 12.6% rise on the previous quarter. Notably, this rise in ‘critical’ distress was widespread, with 21 of the 22 sectors monitored by Red Flag Alert reporting a considerable deterioration in their financial health compared with the same period last year. The data paints a particularly difficult picture for consumer-facing industries, which continue to bear the brunt of the ongoing economic uncertainty. Leisure & Cultural Activities (+96.7%), Hotels & Accommodation (+92.5%), and General Retailers (+85.6%) saw some of the steepest increases in ‘critical’ distress over the last 12 months. Meanwhile, the number of businesses in ‘significant’ financial distress also continued to climb in 18 out of 22 sectors analysed, rising 14.8% year-on-year to 726,594 firms. To read Begbies Traynor’s news release, go to https://www.begbies-traynorgroup.com/news/press-releases/critical-financial-distress-soars-across-the-economy-ahead-of-budget.