‘Don’t break out the champagne’: business insolvencies dramatically down, not a sign of financial resilience, economists warn

Depressed insolvency rates are ‘encouraging’ but likely offer more reasons for concern than optimism, say economists, with businesses insolvency down by more than a third during the two quarters affected by COVID-19.

Massive COVID-19 spending supports for businesses by the Liberal government, and overseen Finance Minister Chrystia Freeland, is just one factor that led to a the paradoxical drop in business insolvencies during the first six months of the pandemic The Hill Times photograph by Andrew Meade

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BY SAMANTHA WRIGHT ALLEN

January 28, 2021

Business insolvencies during the first six months of the pandemic were down by almost one-third compared to the previous year, a surprising result that has economists at leading banks calling the results “encouraging,” but warning it shouldn’t be taken as a sign...

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