New issue trading activity shows a 6.4% drop in August year over year, with 5,907 new businesses launched. The number marks the lowest August total since 2020, when roughly 5,700 companies opened for business, according to the National Institute of Statistics (INE).
The pattern of company formation has fallen through August, continuing an autumnal slide that has persisted for five straight months. The declines followed 8.2% in April, 4.6% in May, 6.8% in June, and a sharp 14.4% in July.
Within the August activity, 5,907 newly established companies attracted more than 276 million euros in subscribed capital, representing a 24.4% year-on-year decrease. The average capital per subscriber dropped 19.3% from the previous year, settling around 46,761 euros.
Meanwhile, business closures climbed by 22.2% in August compared with the same month a year earlier, totaling 1,558 dissolutions.
For the first eight months of the year, net formation of companies was 3.6% lower, while the number of dissolved companies rose 8.9% versus the same period in 2021.
Of the 1,558 companies that closed in August, 78.2% did so voluntarily, 13.4% dissolved due to mergers with other firms, and 8.4% closed for other reasons.
In August, 18.2% of new commercial companies operated in real estate, finance and insurance activities, and 18.1% were involved in retail trade. For dissolutions by principal economic activity, the highest shares occurred in trade at 18.6% and construction at 15.5%.
Capital increases among commercial companies rose modestly, by 1.2% in August, totaling 2,060 firms. The capital committed in these increases exceeded 1.244 billion euros, a 35.2% drop from August 2021, while the average capital rose to 604,326 euros, down 36% year over year.
Madrid and Catalonia drive company formation
In August, Madrid led as the region with the most new companies (1,309), followed by Catalonia (1,185) and Andalusia (922). The regions recording the fewest openings were La Rioja (24), Navarra (43), and Cantabria (54).
Twelve regions posted fewer company openings in August than in August of the previous year. The steepest declines were in La Rioja (-40%), Navarra (-33.8%), Extremadura (-17.5%), and the Valencian Community (-14.5%). Asturias (+33.8%), Balearic Islands (+21.1%), Cantabria (+20%), Canary Islands (+14%), and Castilla y León (+5.6%) saw increases.
Looking at closures by community, Madrid reported the most dissolved entities (578), followed by Andalusia (215) and Comunidad Valenciana (144). Conversely, Navarra (4), La Rioja (8), and Extremadura (14) had the fewest dissolutions.
In August, twelve regions recorded higher numbers of closures, led by Murcia (+277.8%), Navarra (+100%), and Cantabria (+72.7%). Five regions saw decreases: Extremadura (-50%), La Rioja (-46.7%), Castilla-La Mancha (-21.7%), Canary Islands (-4.1%), and Catalonia, where corporate disappearances fell 2.6% year over year.
Monthly trend: company creation falls 17.7%
From August to July, the formation of new companies declined by 17.7%, marking the most moderate drop in at least five years. In contrast, the number of liquidations decreased by 4.1% in August compared with July, the smallest monthly decline observed since at least 2018.