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16th February 2018
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Manufacturing and construction sectors struggle on in 2013, as latest insolvency figures show
- Over 1,000 insolvencies combined for both industries in Q1 2013
- Construction: 5,500 construction insolvencies since April 2011
- Manufacturing: 3,465 insolvencies in the same period
There have been nearly 9,000 cases of insolvencies in construction and manufacturing since Q2 2011 PricewaterhouseCoopers' figures reveal, although the two sectors did see a fall in the last quarter.
The two sectors remain among the worst affected out of all industry areas and despite a less aggressive quarter both sectors combined still generated 1,013 insolvencies between January and March.
In Q1 of 2013 there were 12% fewer insolvencies in manufacturing than the previous quarter, 388 compared to 444 for Q4 2012.The regions most affected in the last three months include the West of England and the South.
Of the 3,465 manufacturing sector insolvencies since Q2 2011, 958 were industrial manufacturing firms with the rest including automotive, aerospace & defence, chemicals, metals, transport and logistics and consumer goods manufacturers.
Philip Hines, PwC Deals & Industrial Products partner, says: "The reduction in manufacturing insolvencies is encouraging but with rising raw material costs and no imminent signs of a material economic recovery, the outlook remains tough for those companies already experiencing financial stress."
Construction also saw a 5% fall in its insolvencies from 658 to 625 nationwide, compared to the previous quarter. London remains the region with the highest number, 103 and over the two year period has seen 977 insolvency cases overall. Of the 5,500 overall construction insolvencies for the entire two year period 1,488 involved general construction/civil engineering firms and 378 involved architectural firms.
Regionally, most places saw a decrease apart from North East & Cumbria (up 27.5%) and the North West which went up 14.8%.
Jonathan Hook, PwC's Engineering & Construction leader, says: ''Any reduction in the number of insolvencies in the construction sector is welcome. The sector in the UK is still experiencing declining output year on year however, so we are not necessarily over the worst yet in terms of insolvencies. There is an ongoing cash squeeze throughout the supply chain as has been evidenced in recent reported results.
"The measures in the recent budget to support infrastructure, and in particular levels of house-building are welcome but will take a little while to feed through into output.''
5th April 2013