{"id":878938,"date":"2025-12-19T23:16:53","date_gmt":"2025-12-20T05:16:53","guid":{"rendered":"https:\/\/newsycanuse.com\/index.php\/2025\/12\/19\/spike-in-construction-insolvencies-heralds-difficult-winter\/"},"modified":"2025-12-19T23:16:53","modified_gmt":"2025-12-20T05:16:53","slug":"spike-in-construction-insolvencies-heralds-difficult-winter","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2025\/12\/19\/spike-in-construction-insolvencies-heralds-difficult-winter\/","title":{"rendered":"Spike in construction insolvencies heralds \u2018difficult winter\u2019"},"content":{"rendered":"
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\"Insolvency_generic.jpg\"<\/p>\n

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Monthly construction insolvencies have surged, according to the latest official figures, leading one analyst to warn of a \u201cdifficult winter\u201d for the sector.<\/p>\n

Insolvency Service data, released on Friday (19 December), shows there were 360 business failures in October.<\/p>\n

This figure marked a 24 per cent rise on September\u2019s total of 291<\/a>, and a 13 per cent increase compared with October 2024\u2019s total of 320.<\/p>\n

According to the latest monthly Insolvency Service data, 2,034 business failures were recorded in October across all industries.<\/p>\n

Rolling annual data from the government agency also showed that construction accounted for 3,973 insolvencies in the 12 months to October 2025 \u2013 17 per cent of the all-industry total and more than any other sector of the economy.<\/p>\n

Second behind construction was the wholesale and retail trade in motor vehicles and motorcycles, with 3,768 collapses.<\/p>\n

Accommodation and food service activities accounted for 3,423 insolvencies.<\/p>\n

\u201cUK construction firms are facing a difficult winter,\u201d said Mark Supperstone, partner at accounting firm S&W.<\/p>\n

\u201cThe sector is grappling with falling demand and rising costs and faces significant structural challenges which risks pushing more companies into distress in 2026.\u201d<\/p>\n

Supperstone cited the latest S&P Global construction PMI index<\/a> of 39.4 as \u201cthe sharpest downturn in output in over five years, driven by weak new orders and mounting pressure from labour, energy and transport costs\u201d.<\/p>\n

He added: \u201cThe key for struggling firms will be payment discipline and cashflow resilience, particularly for specialist subcontractors exposed to fixed price contracts and elongated supply chains.<\/p>\n

Supperstone said contractors may need to tighten their working capital controls \u00a0\u201cto preserve jobs and deliver projects through a potentially volatile start to 2026\u201d.<\/p>\n

Qarrar Somji, director at Birmingham-based law firm Witan Solicitors and a specialist in company restructuring and insolvency, said: \u201cThe construction industry is facing a deepening crisis, and it is not slowing down any time soon.\u201d<\/p>\n

He criticised the \u201cflawed\u201d payments system as one reason why so many construction firms face financial distress, adding: \u201cWhile tougher regulations are needed to secure the financial health of the supply chain, in the short term, firms need to push for better contractual payment terms and put greater protections in place against early signs of failure.\u201d<\/p>\n

Somji also said last month\u2019s Budget is adding to construction firms\u2019 problems, especially with higher employment costs<\/a> due to an increased legal minimum wage.<\/p>\n

\u201cWe expect to see more companies needing restructuring or facing outright collapse,\u201d he warned.<\/p>\n

\u201cIn the coming months, firms will need to make difficult choices about hiring staff, increasing pay and repricing projects.\u201d<\/p>\n<\/div>\n<\/div>\n

Read More<\/a>
\n Ben Vogel<\/p>\n","protected":false},"excerpt":{"rendered":"

Monthly construction insolvencies have surged, according to the latest official figures, leading one analyst to warn of a \u201cdifficult winter\u201d for the sector. Insolvency Service data, released on Friday (19 December), shows there were 360 business failures in October. This figure marked a 24 per cent rise on September\u2019s total of 291, and a 13<\/p>\n","protected":false},"author":1,"featured_media":878939,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2808,22781],"tags":[],"class_list":{"0":"post-878938","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-construction","8":"category-spike"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/878938","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=878938"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/878938\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/878939"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=878938"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=878938"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=878938"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}