Construction Insolvencies Up in July but Down on Previous Year

CONSTRUCTION FIRMS accounted for 15.2% of all insolvencies in England and Wales in July 2025, with 332 registered construction businesses becoming insolvent.

This was a 2.5% increase on the construction insolvencies seen in June and a 3.5% fall on the 334 recorded in July 2024, according to The Insolvency Service.

By rough comparison, construction firms accounted for 14% of all registered businesses in the UK in 2024.

The largest proportion of construction insolvencies were among firms providing specialised construction activities with 195 recorded – four more than the number seen in June.

July Insolvencies Down on Previous Year

The total number of construction firms becoming insolvent in the 12 months to the end of July 2025 was 3,973. This was a 9.5% decrease on the 4,389 insolvencies recorded in the year to July 2024, and a 23.5% increase on the 3,218 in pre-pandemic 2019.

Of all cases where the industry was captured in the statistics, construction experienced the highest number of insolvencies in the year to July 2025.

The Insolvency Service said while the insolvency rate has increased since the lows seen in 2020 and 2021, it remains much lower than the peak of 113.1 per 10,000 companies seen during the 2008-09 recession. This is because the number of companies on the effective register has more than doubled over this period. The rate in the year to the end of August 2025 was 52.6 per 10,000 companies.

Scotland Insolvencies

In Scotland, there were 14 construction company insolvencies in August 2025, accounting for 14.7% of all insolvencies in the country.

The number of Scottish construction insolvencies for the 12-month period to August 2025 was 192. This was a 6.3% decrease on the 205 seen in the year to August 2024 and a 7.3% fall 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.

Further data released by The Insolvency Service showed that 310, or 26%, of self-employed or trader bankruptcies in the 12 months to June 2025 were in construction in England and Wales.

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