Scottish towns of Clydebank, Glasgow and Livingston buck UK–wide decline
South West towns lead the way in falling insolvencies
Nottingham, UK, 26 March 2013 – Analysis published today by Experian®, the global information services company, shows there was an increase in personal insolvencies among people living in small villages and farmhouses last year while the overall number of personal insolvencies across the country fell during 2012.
Experian’s analysis of personal insolvency statistics using its Mosaic people classification revealed that financial hardship increased most among those in the Professional Rewards group, one of the UK’s most affluent sectors. This demographic, which represents company managers and senior executives, typically married with children and living in suburban areas or semi-rural dormitory villages with a long commute to work, saw a rise in personal insolvencies, from 5.15 per cent of the total insolvencies across the UK last year during 2011 to 5.6 per cent in 2012.
The Rural Solitudes group, a mix of farmers, those who work for businesses that provide services for the farming industry and people who have deliberately retired to a community with a slower pace of life, also saw their share of insolvencies increase last year. This group, a high proportion of which are married and living in the South West in neighbourhoods with a traditional country way of life, saw insolvencies rise from 3.98 per cent of total insolvencies in 2011 to 4.4 per cent in 2012.
In stark contrast, families and couples owning affordable older style housing in communities historically dependent on manufacturing, experienced the biggest drop in their proportion of severe personal financial difficulties in 2012. The Industrial Heritage group, members of which have typically stayed in the area they grew up in and mostly earn their incomes from the exercise of manual and craft skills, saw its proportion of insolvencies decrease from 8.80 per cent of the total population in 2011 to 8.36 per cent in 2012. This group was closely followed by the Terraced Melting Pot group, representing mostly young people in relatively routine urban occupations and living in the centre of small towns, which saw a decrease from 7.89 per cent in 2011 to 7.54 per cent in 2012.
Despite accounting for the largest share of those declaring themselves insolvent in the UK during 2012, the Ex-Council Community, representing those typically living on council estates, experienced a drop in their quotient of the total number of insolvencies – from 13.74 per cent to 13.57 per cent.
While the total number of individuals being declared insolvent fell across the country, some areas of the UK, particularly Scotland, continued to struggle. The Scottish town of Clydebank saw the biggest increase in insolvencies last year, rising by 23 basis points in 2012. Furthermore, the top five towns with the highest concentration of personal insolvencies were in Scotland: Edinburgh, Dundee, Aberdeen, Motherwell, and Glasgow (Parkhead).
Towns that showed the strongest signs of recovery were Gloucester, Bournemouth (Boscombe) and Telford, recording the UK’s biggest drop in insolvencies, falling 28, 24 and 21 basis points respectively.
Jonathan Westley, Managing Director of Experian’s Consumer Information Services UK & Ireland, commented: “While it is encouraging to see that personal insolvency levels are continuing to fall in the UK overall, it is clear that there are still pockets of the UK that are feeling the strain.
“It is as important as ever for organisations to be able to identify and segment customers based upon their specific needs and characteristics, enabling fair lending processes to the financially vulnerable. By using data analytics to establish the individual circumstances of customers, lenders will be able to build an overall picture of their financial situation so that they can treat customers sensitively and put in place measures to help the most vulnerable.”
Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2012 was US$4.5 billion. Experian employs approximately 17,000 people in 44 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.
For more information, visit http://www.experianplc.com.