Rising costs and delays push UK construction companies to the brink

Posted on August 29, 2023   |  

The construction industry in the UK is experiencing a surge in business closures due to cost inflation, a slowdown in housebuilding, and government project delays.

A total of 4,280 construction operators folded their operations in a year, marking a substantial 16.5% rise in comparison to the previous year.

Buckingham Groupceased trading, citing "Extreme Inflation" Buckingham Group, a well-known contractor, halts operations and attributes challenges to unanticipated impacts, including the impact of inflation.

Smaller subcontractors bear the brunt of the crisis, accounting for 2,499 out of 4,280 insolvencies, as they struggle to navigate the supply chain challenges.

Despite a slight decline, construction material prices remain significantly elevated by 42.7% compared to pre-pandemic levels, posing challenges to project feasibility.

UK Government postponed HS2 and road projects amid Inflation concerns critical projects like HS2 face delays due to mounting inflationary pressures and rising costs, creating hurdles for the execution of infrastructure plans.