Construction Insolvencies Taper Off in September

Construction firms accounted for 16% of all insolvencies in England and Wales in September 2026, with 285 registered construction businesses becoming insolvent.

This was 20 fewer than the 305 recorded in August 2026 and seven less than in September 2025.

By comparison, the Insolvency Service found construction firms accounted for 14% of all registered businesses in the UK as of September 2026.

The largest proportion of construction insolvencies were among firms providing specialised construction activities with 168 recorded in September.

The total number of construction firms becoming insolvent in the 12 months to September 2026 was 3,873. This was a 2% decrease on the 3,939 insolvencies recorded in the year ending in September 2025 but a 20% increase on the 3,221 in pre-pandemic 2019.

Sam Parkin, Senior Economist at BCIS, said: “While the overall decline in construction insolvencies is welcome, the headline figure masks significant differences across the industry.

“For example, insolvencies among firms involved in road and railway construction rose by 24.4% in the 12 months to September 2026 compared with the previous 12-month period. Insolvencies among demolition and site preparation firms increased by 15.6%, while businesses constructing residential and non-residential buildings saw a 5.7% rise.

“In fact, when we break the figures down by type of construction activity, more categories recorded an increase in insolvencies than a decrease over the past year.

“There are some encouraging signs, particularly among specialist contractors, which typically account for the largest share of construction insolvencies. However, as the government prepares for the Autumn Budget, these figures provide another important indication of the challenges facing the industry.

“Insolvencies don’t necessarily translate directly into lost labour or capacity, but they do highlight the need for more favourable conditions to help construction businesses be able to deliver viable work.”

Scotland Insolvencies

In Scotland, there were 21 construction company insolvencies in September 2026, eight more than in August 2026, accounting for 18% of all insolvencies in the country.

The number of Scottish construction insolvencies for the 12-month period ending in September 2026 was 191, two less than the 193 recorded in the year to September 2025, and an 8% decrease on the 207 in pre-pandemic 2019.

Within the industry, firms classified as providing specialised construction activities are consistently the most affected across Great Britain. However, analysis shows that their numbers are proportional to their overall share within the construction sector.

This category includes companies providing a range of work, typically on a subcontract basis, from demolition and site preparation to electrical and plumbing installation, and finishing work like plastering, painting and glazing.

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