THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, August 23, 1996 TAG: 9608230039
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: STAFF AND WIRE REPORT
LENGTH: 62 lines
Business failures in Hampton Roads and across the nation continued to increase for the first six months of the year as a weakening economy took its heaviest toll on agriculture, construction and retailing.
During the first six months of 1996, 38,866 U.S. businesses failed, up from 36,560 in the same period a year ago, the financial information provider Dun & Bradstreet Corp. reported. Liabilities of the failed businesses rose 51 percent to $17.08 billion. That's a 6 percent increase.
Business bankruptcies in Hampton Roads increased 16.8 percent from 161 to 188 or the first half of this year, according to the Eastern District of Virginia U.S. Bankruptcy Court.
``Failure rates remain well below the peak levels experienced in 1992, but they are clearly rising as the economy slows,'' Joseph W. Duncan, vice president and chief economist of D&B, said in a statement.
He said the faster growth in liabilities of the failed companies ``suggests that the more modest pace of growth is taking an exaggerated toll on larger, more heavily leveraged businesses that had anticipated more robust economic activity in the first and second quarters.''
Industries seeing the biggest increases in failures were agriculture/forestry/fishing at 46 percent, construction at 18 percent and retail trade with an increase of 13 percent. Financial/insurance/real estate saw failures rise 12 percent.
Duncan said reduced consumer activity amid severe winter weather and a slow 1995 holiday shopping season appears to have played a role in the high failure rates. Industrial companies fared relatively well, he added. MEMO: (The Associated Press contributed to this report)
Business failures in Hampton Roads and across the nation continued to
increase for the first six months of the year as a weakening economy
took its heaviest toll on agriculture, construction and retailing.
During the first six months of 1996, 38,866 U.S. businesses failed,
up from 36,560 in the same period a year ago, the financial information
provider Dun & Bradstreet Corp. reported. Liabilities of the failed
businesses rose 51 percent to $17.08 billion. That's a 6 percent
increase.
Business bankruptcies in Hampton Roads increased 16.8 percent from
161 to 188 or the first half of this year, according to the Eastern
District of Virginia U.S. Bankruptcy Court.
``Failure rates remain well below the peak levels experienced in
1992, but they are clearly rising as
the economy slows,'' Joseph W. Duncan, vice president and chief
economist of D&B, said in a statement.
He said the faster growth in liabilities of the failed companies
``suggests that the more modest pace of growth is taking an exaggerated
toll on larger, more heavily leveraged businesses that had anticipated
more robust economic activity in the first and second quarters.''
Industries seeing the biggest increases in failures were
agriculture/forestry/fishing at 46 percent, construction at 18 percent
and retail trade with an increase of 13 percent.
Financial/insurance/real estate saw failures rise 12 percent.
Duncan said reduced consumer activity amid severe winter weather and
a slow 1995 holiday shopping season appears to have played a role in the
high failure rates. Industrial companies fared relatively well, he
added.
(The Associated Press contributed to this report) by CNB