PwC: Manufacturing and construction insolvencies top the 9,000 mark

By Rob Starr, Content Manager, Big4.com

Despite the two sectors enjoying one of the best quarters in nearly two years, there have been 9,113 insolvencies in construction and manufacturing since September of 2010, PwC figures reveal. Across all sectors there were 11% fewer insolvencies this quarter than the previous one, but under the ongoing cloud of economic and unemployment uncertainty, PwC experts say the slight reprieve in figures may not signal a long term improvement with the same pressures continuing through to 2013.

London suffered 120 construction insolvencies in Q2 and has lost 962 firms overall in the industry since Q3 2010. Most regions again enjoyed a slightly better quarter with Yorkshire, the West and East regions faring better.
In the West Midlands there were 54 manufacturing insolvencies for Q2 this year, compared to 83 in Q1 of this year, about 35% fewer.

“These figures are disappointing for the industry, but not unexpected given the significant slow down in work, particularly in the public sector. Not surprisingly it is generally impacting smaller private businesses who have less exposure to frameworks and generally shorter order books, although we have seen the demise of bigger names such as Rok plc,” said Dominic Wilkinson, a Director at PwC.

In Q2 of 2012 (April to June) there were 15.5% fewer insolvencies in construction than the previous quarter, and nearly 8.36% fewer in manufacturing. But where most regions enjoyed a relatively good quarter, London lost 66 manufacturing firms – the biggest rise in any UK region at 50%.