According to data from Informa D&B, 23,488 new companies were created by the end of May, marking a 2.9% decrease compared to the same period last year.

This translates to 690 fewer companies formed, with the decline primarily occurring in the first quarter.

Regional Insights

The Lisbon Metropolitan Area saw the most significant decline, with 967 fewer company formations (-10%), followed by Alentejo and Algarve. Conversely, the North region experienced growth with 191 additional companies (+2.7%). The Center region and Autonomous Regions also saw an increase in new company creations until May 31.

Sectoral Trends

Most sectors experienced a decline in company formations. The transport sector saw a 24% decrease (-713 companies), a trend ongoing since December, especially in passenger transport by light vehicles. The real estate sector saw a 7% decrease (-159 companies), wholesalers declined by 11% (-114 companies), and accommodation and catering dropped by 4.2% (-101 companies).

However, the construction sector bucked the trend, with 225 more companies formed than in the same period last year (+8.4%).

Insolvency Trends

Informa D&B's data also highlights an increase in insolvency processes, with 914 companies initiating proceedings by the end of May—a 12% increase (+101 insolvency proceedings) from the same period last year. This rise is largely driven by the industrial sector, particularly the textile and fashion industry.

The industrial sector saw an 81% increase in insolvencies (+125 cases), with textile and fashion companies leading the surge (+163%, +109 cases). Footwear manufacturing (+442%, +53 cases) and outerwear production (+113%, +35 cases) were notably affected, especially in the Porto and Braga districts.

Retail, the second-most affected sector, also saw a significant increase in insolvencies (+20%, +22 cases). Photo by Phil Whitehouse, Wikimedia commons.