Number of firms going bust falls 4.7% in third quarter but experts warn the rate remains worryingly high
The number of construction businesses failing fell 4.7% in the third quarter, according to the Insolvency Service.
The total that became insolvent from July to September 2009 was 106, down from 111 in the second quarter and down 13.2% from the first quarter.
The number is 47.2% down from the peak of 156 construction business failures seen in the fourth quarter 2008.
But Kathryn Hiddlestone, head of construction for business adviser Grant Thornton, said the number was not far from the 2008 average of 177 construction business failures.
“This means there has yet to be a significant decline in construction businesses going under,” she said. “Failures in construction companies are still at a high rate and remain a major concern for the industry, despite the decline.”
She added that there was plenty of trouble ahead: “Construction usually lags other sectors in recovering from a slump, so it is likely to fall much further before a real upturn is seen. Unfortunately this will not help the vast number of existing construction work which is now being considerably prolonged and even shelved.”