The construction sector has experienced a 41 per cent rise in companies facing critical financial distress over the last twelve months, according to a corporate rescue specialist.
In a quarterly report, Begbies Traynor said market conditions in the construction sector are deteriorating with a 41 per cent increase in companies facing critical distress during Q3 2011 when compared to Q3 2010.
Gary Lee, partner at Begbies Traynor, said: “There has been a decline in new construction orders over the last twelve months as the sector is vulnerable to reductions in both capital and revenue spending by the public sector through central and local government and by private sector businesses trying to conserve cash.
“While the construction of the Olympic venues in London may have had a positive effect in the South east, the situation is more serious elsewhere in the UK with companies battling for dwindling contracts. In addition the lack of confidence and the ongoing Eurozone crisis is likely to result in further delays to capital projects,” Mr Lee said.