The latest company insolvency statistics identified that insolvencies for specialised construction activities marginally dropped to 164 in August this year, down from 179 in August last year, but continued to account for more than half (55.7%) of insolvencies within the sector.

The construction sector saw 3,866 insolvencies in the 12 months to August this year, constituting 17% of all insolvencies in the economy - the highest among all sectors. 

In response to the statistics, Kelly Boorman, head of construction at RSM UK, said: “Long-term uncertainty over future pipeline allocation and mobilisation, along with macroeconomic conditions, is weighing heavily on the construction sector as rising inflation, energy price volatility and the potential for interest rate hikes later in the year fuel concerns around financing and funding. 

“There are signs of short-term market health, as businesses continue to deliver on secured pipelines. 

“However, the long-term outlook faces uncertainty around when and where major infrastructure spend will be allocated.”

Boorman added: “Housing volumes also remain challenged, with private residential demand declining further and social housing funders seeing funding structure changes, and major developers are announcing cuts to their housebuilding targets. 

“Unfortunately, as the sector braces for winter weather, further uncertainty over policy and high energy prices pushing inflation to over 4%, we could see the upward trend in sector insolvencies continue in the coming months.”