Impact of Covid-19, sees 29% YoY decline in Irish start-ups during early stages of pandemic

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  • Company and business start-ups dropped by 29% YoY for the combined period of March and April
  • April proved to be a difficult period for start-ups, with a decrease of 43% in new company and business compared to April last year
  • Financial Intermediation experiences unique growth in start-ups, with an increase of 22% during March and April
  • Leasing (-52%), construction (-49%) and motor (-49%) industries experienced the biggest drop in start-ups during the pandemic
  • Vision-Net MD: ‘As we continue to progress on our roadmap to recovery, it is vital that industry and Government work together to fully understand the implications of the pandemic on the start-up community and to ensure that necessary supports are put in place to help start-ups to rebuild and to adapt to the evolving situation.”

Latest figures from business and credit risk analyst CRIF Vision-net, show that there has been a 29% year on year decrease in Irish start-ups since the start of the Covid-19 pandemic in Ireland.

According to the new figures published today, Irish start-ups have declined by 2,253 companies and businesses for the combined period of March and April when compared to the same period in 2019 (7,773 start-ups).

While the figures suggest a downturn in start-ups from March (-15% YoY), the month of April proved to be the most difficult month for company start-ups this year, with a decrease of almost 45% compared to April 2019.

Industry Insights: Jan-Feb 2020 vs March-April 2020

The Covid-19 pandemic has had a negative impact on the growth of start-ups across most industries, with the majority of sectors experiencing a drop in company start-ups during March and April when compared to the first two months of the year.

Leasing (53 start-ups, -52%), construction (237 start-ups, -49%) and motor (29 start-ups, -49%) industries experienced the biggest decline in start-upsduring this period, followed by education (40 start-ups, -48%), community, social and personal activates (267 start-ups, -43%) and hospitality (131 start-ups, -41%).

The financial intermediation sector experienced unique growth in start-ups during this period, with an increase of 22% during March and April, totalling 586 start-ups to date.

Regional overview: Jan-Feb 2020 vs March-April 2020

Dublin (3,144), Cork (625) and Meath (315) recorded the highest number of start-ups so far this year.

However, the figures released today reveal that all counties in Ireland have experienced a decline in company start-ups since the beginning of March. 

According to the data, Sligo (-69%), Leitrim (-67%), Longford (-64%) and Louth (-64%) are among the counties worst affected by Covid-19, experiencing the biggest drop in start-ups during the months of March and April.

Insight 

Commenting on the figures, Christine Cullen, Managing Director of CRIF Vision-net, said:  

“Covid-19 has had a significant impact on businesses of all experience levels. Whether it is a company start-up or a well-established business, everybody has felt the brunt of the pandemic with lockdown and social distancing restrictions having obvious operational and financial implications for many industries.

“To this end, it may not come as a complete surprise that we have experienced a decline in start-ups since the beginning of the pandemic. Even in the best of times, the survival of a start-up isn’t guaranteed and the current climate is certainly not one that fosters growth and development.

“To help combat this, we must ensure that we remain future focused and develop a robust recovery strategy for the start-up community that encourages growth and innovation. As we continue to progress on our roadmap to recovery, it is vital that industry and Government work together to fully understand the implications of the pandemic on the start-up community and to ensure that necessary supports are put in place to help start-ups rebuild and adapt to the evolving situation.

“Last year Ireland recorded its highest start-up figures in 13 years, which demonstrates the capabilities and potential that exists here. We must work to protect this and to help businesses get back on their feet as soon as possible.”

END