November economic and business overview

November economic and business overview

November 1, 2023

The economy is wallowing but fraudsters are busy

The signs of an embattled economy are everywhere to be seen, despite the ongoing debate about whether or not the UK will avoid a recession in the final quarter of this year or in 2024.

Economic indicators

GDP is stagnating

The best the UK economy could manage in the latest GDP statistics was a distinctly marginal 0.3% growth for the three months to August 2023. A 0.4% drop in the GDP of consumer-facing service businesses was headline proof of the continuing impact of the cost of living crisis.

The labour market is weakening

Unemployment is rising, or at least it might be if only the Office for National Statistics could rely on its previous labour market data, which it seems has been compromised for some time by poor survey response levels and changes in working practices. What is certain is that job vacancies are falling and not through jobs being filled but because posts are being withdrawn by cautious employers in 14 of the 18 business sectors.

Insolvencies are at near record levels

Business failures continue to run well ahead of pre-pandemic levels (by 29% in September 2023) to the extent that this year looks like having the second highest level of company insolvencies on record at around 26,000. Predictably, the worst hit sectors are retail, hospitality, construction and manufacturing.

The housing market is struggling

Looking at year-on-year comparisons, average house prices were down 4.7% in September 2023, net mortgage approvals fell by a third in August 2023 and the volume of residential property sales fell by 17% in October 2023.

Business fraud

It’s an accepted fact that in times of economic woe and hardship such as these, commercial fraud tends to increase. Frustratingly, this is an area where there is a distinct lack of meaningful or consistent data, perhaps because, rather like insolvency risk, too many business owners and managers are unwilling on reputational grounds even to talk about business fraud, never mind actually report it when they become victims.

There is a broad public awareness of business fraud, prompted by recent high profile cases such as Patisserie Valerie and Carillion, as well as government revelations of the scale of abuse of the Covid loan schemes, in particular the Bounce Back Loan scheme, where £1.65bn is estimated to have been lost to fraud. Unfortunately, there is relatively little detailed information to quantify and create a better understanding of what is clearly a major problem for UK businesses of all types and sizes.

Economic Crime Survey 2018 – 2020

There was considerable surprise when the Home Office finally published its Economic Crime Survey covering the years 2018 to 2020 in May 2023. The impact of releasing data so long after its basis period reduces some of its usefulness, but better to have some data than none at all.

The research covered incidences of fraud in seven business sectors: retail, construction, financial services, mining, property, IT and legal services. The headline conclusion was that if the data for 2018 to 2020 was extrapolated through to 2023, there will have been an astounding 4.5m cases of fraud over a five-year period. Unfortunately, the survey confirmed that only 32% of companies had reported their most recent fraud experience to the police and only 25% to Action Fraud, the national fraud reporting service.

Equally shocking was the statistic that the rate of frauds was 3,917 per 1,000 companies, indicating a high level of repeat victimisation. The survey also found that almost one in five businesses had been the victims of fraud. In terms of financial data, it suggests that the annual cost to the business community may be £8.4bn a year. Business Fraud Report 2023

A report released by in June 2023 puts values to the 39,155 fraud cases it has identified for the year to Q1 2023 as being the result of organised crime activity and cyber crime, just one subset of fraudulent business activity. The losses on these cases totalled £2.15bn.

These bare statistics illustrate the sheer scale of fraud in the UK economy. In our next article, we will be looking at this problem from the forensic accountant’s point of view, as well as the asset tracing challenges these cases can bring to even the most experienced professionals.


If you are seeking professional forensic accounting advice or you are concerned about business fraud within your organisation, Opus is here to help. You can speak to one of our Forensic Accounting specialists on 020 3326 6454, or email .