Around 185,000 IT sector jobs are currently under threat, according to new research.

The latest business distress index from UK company Real Business Rescue, found that the number of IT SMEs in significant financial distress stands at 47,000, an increase of 15 per cent increase in the first quarter of the year.

The index found that the number of start-up IT firms that were set up after 2017 in significant financial distress had increased by 37 per cent in the previous quarter due to the pandemic.

There are now 9,289 of these fledgling businesses compared to 6,779 at the end of 2020 – with an overall 149 per cent increase since the start of lockdown twelve months ago when there were just 3,732 in distress.

"The latest Q1 results demonstrate that for many SME and start-up businesses, the financial challenge of the pandemic will continue throughout 2021,” said Shaun Barton, national online business operations director, Real Business Rescue. “With a 15 per cent increase in the number of smaller sized companies reported to be in significant financial distress during Q1 of 2021 compared to the end of 2020, this continues the trend we have seen since the health and economic crisis first struck more than a year ago.

Barton added: “We need the smaller IT, construction, office supplies, restaurant, bar and hotel chains to be open and face-to-face services to be functioning in order to survive. That is why these smaller-sized firms – that may have spotted an opportunity before the pandemic – are struggling and start-ups have seen a 33% increase since the start of this year alone.”

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