More than 40,000 construction firms are operating on the brink of collapse

July 31, 2017 – There has been a 22% rise in the number of construction companies in significant financial distress over the past year, according to expert analysis.


Accountants from insolvency specialist Begbies Traynor publish their Red Flag Alert research four times a year. The Q2 2017 report, out today, shows that 40,495 construction companies are operating in a state of ‘significant’ financial distress at the end of June. A year ago the number was 33,222.

Begbies Traynor said that the increase provided further evidence of a slowdown in the UK housing and construction markets

The property sector has also deteriorated over the past year, the report indicates, with 28,259 real estate businesses in ‘significant’ financial distress, up 32% from 21,373 this time last year.

Julie Palmer, partner at Begbies Traynor, said: “While we are seeing rising levels of distress across all corners of the UK economy, the quarterly deterioration in the property and construction sectors is particularly concerning, raising doubts over whether they have strong enough foundations to cope with upcoming headwinds, from Brexit and the rising cost of imported goods to the widening skills gap and its impact on labour cost inflation.”




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