6,600 firms ‘could go bust in 2013’
Around a third of all construction firms in North West England could go bust in the next year, according to new research.
Insolvency trade body R3 claimed building companies were more likely to fail over the next 12 months than other businesses in the region as many firms struggle to emerge out of the recession.
Public spending cuts and a lack of development finance could prompt the collapse of around 6,600 construction and civil engineering companies based in the North West next year.
The latest Markit/CIPS Construction Purchasing Managers’ Index showed a rise in construction output during October, but new orders slumped for the fifth month in a row and construction jobs were cut at the fastest rate since August last year.
Jeremy Oddie, North West regional chair of R3, said the construction sector has been “one of the worst affected” by the economic downturn, with “no relief” on the horizon.
“Developers are finding it extremely difficult to raise funds and can often only do so on the back of an anchor tenant,” said Mr Oddie.
Copyright Press Association 2012