{"id":136529,"date":"2024-01-29T10:29:36","date_gmt":"2024-01-29T10:29:36","guid":{"rendered":"https:\/\/www.pbctoday.co.uk\/news\/?p=136529"},"modified":"2024-01-29T10:29:36","modified_gmt":"2024-01-29T10:29:36","slug":"12-of-uk-administrations-in-2023-construction-industry","status":"publish","type":"post","link":"https:\/\/www.pbctoday.co.uk\/news\/planning-construction-news\/12-of-uk-administrations-in-2023-construction-industry\/136529\/","title":{"rendered":"12% of UK administrations in 2023 were in construction industry"},"content":{"rendered":"

The construction industry accounted for 12% of administrations in 2023 \u2013 the second highest sector in the UK, and a 22% increase compared to 2022<\/h2>\n

A total of 1,641 businesses, 200 of which came from the construction industry, filed for administration last year \u2013 marking a 22% increase compared to 2022<\/a> and a 91% rise in comparison to 2021.<\/p>\n

Analysis from law firm Shakespeare Martineau found that retail, construction, hospitality, manufacturing, and real estate were the worst-hit sectors, collectively accounting for 59% of the administrations.<\/p>\n

Administrations are returning to pre-COVID levels<\/h3>\n

Regionally, Greater London led the way with 22% of the filings, followed by the North West (14%) and South East (12%), according to data from The Gazette Official Public Record<\/a>.<\/p>\n

While January (76) was the quietest month, administration numbers leapt to 177 in October \u2013 the most recorded for 43 months (185 in March 2020).<\/p>\n

More construction firms may face administration in 2024<\/h3>\n

Andy Taylor, partner and head of restructuring at Shakespeare Martineau, said: \u201cThe significant uptick in the number of companies filing for administration in 2023 underscores the challenges faced by businesses amid changing consumer habits, financial pressures, and geopolitical uncertainties.<\/p>\n

\u201cIn the labyrinth of economic complexities, the retail sector in particular is bearing the brunt, noted by the collapse of major player Wilko. There has also been a reduction in housebuilding, which has a knock-on effect in the construction and real estate sectors.<\/p>\n

\u201cThe cost of money, marked by high-interest rates throughout 2023, exacerbates financial strains on businesses with models that thrived in a sub-2% interest rate environment.<\/p>\n

Organisations can only bear that pressure for so long before its sustained impact starts to wash through, and they begin running out of cash.<\/p>\n

Imports and inflation are subject to international tensions<\/h3>\n

\u201cThe global stage, marked by geopolitical tensions in Russia-Ukraine and Israel-Gaza, contributes to economic uncertainty and suppressed growth. Businesses reliant on imports face increased outlays, as shipping companies opt to avoid the dangers of the Suez Canal and seek to pass on the extra costs of transport to customers.<\/p>\n

\u201cMany predict the rate of inflation to continue its downward trajectory in 2024, perhaps even approaching Bank of England\u2019s target of 2%. If that trend continues one might anticipate something like three interest rate cuts in 2024, which will hopefully stimulate growth. However, the economic landscape remains unpredictable, and our advice remains consistent \u2013 seeking professional advice early can open up more options for struggling businesses.<\/p>\n

\u201cIt is crucial not to ignore the signs and bury your head in the sand and instead, take a proactive approach to address underlying issues<\/a>. By doing so, businesses can better navigate the tough trading conditions and increase their chances of survival.\u201d<\/p>\n

\n<\/div>","protected":false},"excerpt":{"rendered":"

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