FEWER city businesses have filed for insolvency during lockdown than in the same period a year ago, while more than 200 new businesses were registered in the city, figures have revealed.

A total of six businesses in Worcester filed for insolvency between March and June 2020 compared to eight during the same period last year.

On top of that, 232 new businesses were registered in Worcester during the same three months according to Company House data.

The drop in the number of businesses going bust is most likely due to the millions of pounds handed out as a lifeline by the government during the coronavirus lockdown, despite hundreds of traders across the city having to close to the public for months.

Many businesses also had to change to survive including pubs, cafes and restaurants which were forced to turn to takeaway only.

Worcester City Council said it has helped businesses by providing business rates relief as well as provided grants and refunds to small businesses totalling more than £19million.

Some experts have warned the true impact of coronavirus will not appear for months as businesses try to adjust to the easing of lockdown measures, social distancing and the end of the government’s furlough scheme.

Councillor Marc Bayliss, leader of Worcester City Council, said: “This year the council is providing just over £22million in business rates reliefs to help local business deal with the effects of the lockdown.

“We have, to date, provided grants and refunds to over 1,400 small businesses and those in the retail, leisure and hospitality sectors, totalling £19.2 million, and continue to provide these grants, actively engaging with businesses who we expect to apply but have not yet done so.

“Further discretionary funding of £888,000 has been provided for which we have received 210 applications.

“To date we have paid grants to 46 small and micro businesses and sole traders, totalling £230,000.”

Herefordshire and Worcestershire Chamber of Commerce has also offered support to local businesses.

Sharon Smith, chamber chief executive, said: “We want businesses to be equipped to handle whatever challenges the future holds and online webinars and training are a time effective way of keeping up to date.

“Upskilling and reskilling for the new business environment will be critical for both employees and employers in the months to come.

“Now more than ever, businesses are looking for support to recover and many are looking for support in launching a new business. We are here for them all and have services to help every size and type of business.”

Economist Stuart Adam from the Institute for Fiscal Studies said: “Some firms may continue to have their activity constrained by social distancing for a considerable period.

“Others may face weaker demand if the recession leads people to spend less, or if the broader crisis changes how we choose to live and spend our money. And even if firms’ future activities are not affected in these ways, debts built up during lockdown might make it harder to keep going.

“The size of all of these effects is highly uncertain – but the uncertainty itself can put a brake on economic activity, especially for cash-strapped households and firms.

“All of these problems might have been worse without the economic support the government has provided, imperfect though it is. To the extent that shoring up the economy during the crisis prevents a much bigger cost over the coming years, it is money well spent – especially while low interest rates make it so cheap for the government to borrow.

“There will also be new business opportunities, created both by changes in consumer demand and by the various government support schemes. Since many firms will undoubtedly shrink or go out of business and jobs will be lost – especially as the furlough scheme comes to an end – it will be vital over the coming months and years for others to start up or expand, to fill the gap and employ those left out of work.”