June saw a notable drop in new commercial company formations compared with the same month in 2021, slipping by 6.8 percent as total activity climbed to 8,909 firms, according to data released this Friday by the National Institute of Statistics (INE).
Across the summer and into June, company creation chains paused for three consecutive months year over year, with declines of 8.2 percent in April and 4.6 percent in May. These patterns reflect a broader trend in the quarter as startups faced challenging conditions while consolidations and closures rose.
For the 8,909 new companies registered in June, more than 362 million euros in capital was subscribed, marking a 23.2 percent decrease from the same month in 2021. The average capital per subscriber stood at 40,739 euros, down 17.6 percent year over year. At the same time, the number of firms being formed did not keep pace with other indicators of entrepreneurship in the period.
While establishment numbers fell, company liquidations climbed by 8.1 percent compared with the previous year, reaching 1,698 closures in June. In the first half of the year, the pace of new company creation slowed by 1.7 percent, while dissolutions increased by 7.7 percent compared with the same period in 2021. This signals a shift in business dynamics as market conditions affected development and exit rates alike.
Of the 1,698 companies that closed in June, 75.4 percent did so voluntarily, 10.9 percent merged with other firms, and 13.7 percent cited other reasons for their shutdowns. The data illustrate a spectrum of outcomes, from voluntary wind-downs to strategic consolidations within the sector.
In terms of activity focus, 19.7 percent of newly established commercial companies in June were engaged in trade, while 18.2 percent operated in real estate, finance, and insurance activities. When looking at the main economic activity of dissolved firms, trade and construction reported the highest closure rates, at 20.8 percent and 15.4 percent respectively.
Capital increases among commercial companies in June saw a slight decline of 0.4 percent, with 2,430 firms raising capital. The total committed capital for these increases exceeded 1,759 million euros, down 0.7 percent from June 2021, while the average capital stood at 724,041 euros, down 0.3 percent year over year.
Madrid and Catalonia lead in company formation
The June leaders in new company formation were Madrid with 2,192 registrations, Catalonia with 1,586, and Andalusia with 1,538. The regions with the smallest levels of startups in June were La Rioja (34), Navarra (60), and Cantabria (80).
Among the regions with the highest numbers of dissolved commercial companies, Comunidad de Madrid reported 571 closures, followed by Andalusia with 261 and the Basque Country with 140. Conversely, Navarra, La Rioja, and Cantabria recorded the fewest dissolutions, each reporting single-digit to low double-digit figures.
On a month-to-month basis from May to June, startups declined further by 2.4 percent, while liquidations edged down by 1.7 percent, illustrating a continuing shift in the market landscape during the second quarter.
Source: National Institute of Statistics