Issue 492 (Week ending 26/01/2022)

Overall, Ireland saw a total of 25,695 new company start-ups in 2021, a 13% increase on pre-pandemic levels (2019), reaching the highest numbers on record in 2021.

The annual figures released this week reveal that a total of 25,695 new start-ups were registered in 2021, the highest figure on record. This marks an overall increase of 17% in new company registrations when compared to 2020 (21,926).

Furthermore, the 2021 start-up figures mark a 13% increase on pre-pandemic levels (2021 vs 2019), showing strong signs of Covid recovery within the Irish economy.

According to the data, the second quarter of the year accounted for the largest number of start-ups (7,600, April-June). March was the strongest month for new registrations with a total of 2,715 new registrations within the monthly period.

Sectoral Analysis: 2021 vs 2020

The legal, accounting and business sector was the biggest contributor to new company start-ups in 2021, recording a total of 4,592 start-ups (+4%, YoY). This was followed closely by the financial intermediation (4,195, +27%), wholesale and retail (3,669, +55%), and construction (2,470, +19%) sectors, which all showed significant resilience to the adverse conditions of the past twelve months. The community, social, and personal activity industry (1,834, -26%) was the only sector to experience a decline in start-ups in 2021.

Regional Overview: 2021 vs 2020

Dublin was the centre of start-up activity in 2021, accounting for 11,815 of all new registrations (+18% YoY). The capital was followed by Cork (2,504, +17%), Galway (992, +15%), and Kildare (952, +17%). Mayo was the only county to record a decrease in start-ups for the year, recording a total of 330, down 2% when compared to 2020.

Insolvencies

A total of 444 company insolvencies were recorded in 2021, a decrease of 6% year-on-year. The most insolvent sector in 2021 was the legal, accounting, and business sector, with a total of 80 insolvencies. The legal sector was followed by financial intermediation (60), construction (58), and real estate (40). Dublin (291) recorded the highest number of insolvencies by county, followed by Cork (37), Galway (26), and Limerick (14).

Although there was a slight decrease in insolvencies, there was a large increase in dissolved companies (those which close without filing for insolvency) recorded in 2021. The total number of dissolved companies totalled 12,410, the highest number since 2018.

Commenting on the annual figures, Christine Cullen, Managing Director of CRIFVision-net, said:

"2021 was a record-breaking year for new company start-ups, marking a significant turning point for the Irish economy's Covid-19 recovery. If we look back to 2020, the contrast in start-up activity was stark. 2020 was the lowest point for the number of new-start-up companies in Ireland since 2016, illustrating the prolonged impact of Covid-19 lockdowns on the Irish economy.

However, 2021 painted a much more positive picture. Achieving the highest number of new company start-up registrations on record is a clear demonstration of the resilience, determination, and hard work of the Irish SME community. Moreover, it gives reason for optimism as we look to the year ahead. The Irish start-up community is buoyant, but the next twelve months will not be without their challenges. The increase in dissolved companies this year serves as a reminder of the challenging environment in which businesses are currently operating, and we must ensure that there are continued supports available to protect new companies and promote growth and development."