Financial strains are being faced by many industries, but construction has been named as the most hard hit, with 7000 firms facing bankruptcy in 2025. A further 97,603 have been labelled as in “significant financial distress”.
What the latest report says…
The latest Reg Flag Report, insolvency practitioner Begbies Traynor said that “6,830 firms in the UK ended 2024 in critical financial distress.”
Tax changes from the October budget are only set to increase the struggles on construction and other industries. It was reported that the estate and property industry had 6,697 firms facing bankruptcy, and support services 6,711.
What’s causing the struggles…
Begbies Traynor partner Julie Palmer expects the number of insolvencies to rise as businesses struggle “to cope with the perfect storm of rising costs, financial instability and fluctuating market conditions.”
It’s sadly a continuing trend, with Red Flag reporting that in 2024 up until reporting in November, construction accounted for the highest number of insolvencies.
The difficult financial climate across multiple industries is a wider issue for construction. According to Johan Geeroms, Director of Risk Underwriting Benelux, maximum vigilance is required from anyone doing business in the construction industry. “Bankruptcies are lurking everywhere. You don’t want to experience a situation where your company has delivered and then a large invoice is not paid because your customer has gone under.”
The industry really is championing for a reduction in tax burden and strong economic growth.
For more details, read this very informative article from Construction News.
Brave steps needed, it’s time to reach out for support…
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