Business Insolvency Rate: methodology

What this metric measures

Companies entering formal insolvency each financial year per 1,000 actively trading businesses. This normalises the raw insolvency count against the size of the business population, which has grown substantially over time.

Why it matters: Raw insolvency counts rise partly because there are simply more businesses. The rate per 1,000 businesses shows whether financial distress is genuinely more common, independent of business-population growth.

Source & provenance

Publisher

ABS 8165.0

Update frequency

annual

Licence

CC BY 4.0

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How the score is computed

The score is a 0–100 normalisation of the latest observation, compared to a baseline window. The traffic-light rating (RAG) reflects both the absolute level and the recent trend.

Direction

Lower is better

Trend window

24 months

Baseline

Last 10 years

{
  "red_min_pct_of_baseline": 110,
  "amber_max_pct_of_baseline": 110,
  "green_max_pct_of_baseline": 95
}