A wave of business restructuring has yet to hit Ireland and the level of insolvency is expected to pick up in the latter part of the year, according to PwC.

Its latest Restructuring Update pointed to insolvency rates in Ireland remaining at an 'artificial' record low level at just 15 firms in every 10,000.

Such levels have not been seen in over a decade and a half, the report concludes, and is well below the average failure rate for the past 17 years of 52 per 10,000 businesses, with a peak of 109 per 10,000 in 2012.

The quarterly rate of insolvency fell by 12% in the first three months of the year compared to the final quarter of last year.

However, when compared to the same three month period in 2021, the rate of business failure between January and March was up by almost a fifth.

In volume terms, that represented an increase from 80 to 97 business failures.

The report author noted that this may point to an increased level of restructuring ahead.

"The current business failure rate remains at an artificial and record low level," Ken Tyrrell, PwC Ireland Business Recovery Partner said.

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"In our inaugural report, 'Act Now: From Recovery to Growth' published in February 2022, we estimated that over 4,500 businesses were saved from going bust primarily as a result of Government’s Covid supports, with a number of these businesses essentially being put on ‘life-support', he added.

The government Covid supports are gradually being wound down with the Employment Wage Subsidy Scheme due to come to an end for most companies this month and for the remainder next month.

The Tax Debt Warehousing Scheme remains open but will gradually close over the coming year.

Not surprisingly, given the level of restrictions imposed on the sector throughout the pandemic shutdowns, arts, entertainment and recreation continued to have the highest business failure rate over the 12 months to the end of March.

During the first quarter, however, the real estate sector had the largest quarterly increase in failures per 10,000 companies, rising from 6 to 20.

Dublin and Kilkenny were the counties with the highest annual rates of business failures in the country, the report noted.

Historically, Ireland's liquidation rate has tended to lag the UK.

In the past year, the UK has been running at 32 liquidations per 10,000 companies while Ireland has been running at around three times the UK rate at 11 per 10,000 companies.

The UK government started to taper its pandemic supports in the Autumn.

As the government here concludes the unwinding of its supports, the economic backdrop is becoming more precarious.

"Most business owners are very aware that the current economic environment is very fluid, given the war in Ukraine, and businesses are facing some strong headwinds in the form of geopolitical uncertainty, higher energy costs and price inflation, continued supply chain issues as well as upward pressure on interest rates," Ken Tyrrell concluded.