Business Failures Decline in Southland, Survey Shows

Business failures in Southern California--and statewide--declined in the first half of 1986 but the number of new businesses formed were virtually unchanged from a year ago, according to a study released Wednesday by Dun & Bradstreet.

The state’s performance in both measures ran counter to the national trend of an increase in the number of business failures and a rise in the business starts, according to Dun & Bradstreet, a New York financial information and marketing service.

Failures of businesses in Southern California fell 8.6% to 3,545 between January and June from the same period last year. In Northern California, the number of failures declined 13.5% to 1,254. That brought the overall decrease for California to 9.9%, which contrasted sharply with an 8.1% increase in number of business failures nationwide.

“The significant drop in failures in California is particularly impressive, considering that virtually every major industry sector reported decreases,” said Joseph W. Duncan, corporate economist and chief statistician for Dun & Bradstreet.

However, the number of new businesses formed in California in the first half of this year totaled 14,465, compared to 14,409 a year ago. Duncan said the pause in growth reflected uncertainty about the new tax legislation and “follows several years of significant growth.” Business starts in the United States overall rose 8.4% to 129,035.