More than half of UK contractors were involved with projects impacted by insolvency in Q2 2024, according to the latest market report published by Gleeds.
Despite recent data from the Insolvency Service showing a month-on-month decline in the number of UK firms going under, the construction sector remains the worst hit for insolvencies.
The report found contractors still operating in the built environment sector continue to take a cautious approach to bidding, with 80% saying they or someone in the supply chain had declined a tender – a fall on the 89% reported in Gleeds’ previous survey.
More than a third of report respondents said they had struggled to secure an adequate number of tenderers for new projects for the second quarter running.
Richard Steer, chair of Gleeds, said: “With scores of contractors and subcontractors collapsing, and interest rates and geopolitical unrest still posing very real threats to growth, there is an undercurrent of caution in the market. While our latest report shows widespread optimism about the new government’s commitment to the industry, timelines for the commencement of big-ticket plans like those to deliver 1.5 million new homes remain unclear and faith in its ability to improve the outlook for construction and real estate in any meaningful way is limited.
“Public finances are under considerable pressure, and we’ve already seen announcements that some infrastructure schemes are to be parked by the chancellor. Until we see a more defined plan to support the sector and confidence returns amongst investors, it seems likely that construction insolvencies will remain high.”
