The construction industry was the UK’s worst affected sector for corporate failures in 2010, business recovery firm PricewaterhouseCoopers (PwC) has said.
The sector suffered 565 insolvencies during the last quarter compared to manufacturing with 410 and retail with 399, figures showed. But one chink of light among the gloom was that all sectors improved on the figures recorded in the same quarter a year earlier.
“It is telling that overall construction insolvencies during 2010 were still 15% above those experienced in 2008. A modest increase in interest rates would also put additional pressure on many struggling companies,” said PwC business recovery services partner Mike Jervis.
Overall, there was an 18.5% drop in the number of corporate failures in 2010 than in the previous year. Improving economic conditions and a widening range of options available to firms in financial difficulties meant 15,894 companies became insolvent last year compared to 19,512 in 2009.
PwC’s analysis shows that London continues to have the highest number of insolvencies with 875 but this is a 24 per cent drop on the same quarter of 2009.