The number of Scottish construction companies forced into compulsory liquidation fell by 20 per cent last year, according to latest figures from the UK Insolvency Service.

The decrease from 727 during 2013 to 578 during 2014 is also 58 per cent fewer bankruptcies than were recorded in 2009 when a total of 1,366 Scottish building companies were forced out of business.

Separate ONS figures published back in October showed a slight increase in the number of companies operating in the Scottish construction industry during 2014. But while the number of small businesses operating in the sector (those employing fewer than 10 people) rose by 280 to 15,620, those figures also showed that the number of medium-sized companies operating in the sector was 25 per cent lower than in 2009 while the number of larger Scottish construction companies (those employing more than 250 people) had also dropped from 35 in 2009 to 25 in 2014.

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Scottish Building Federation managing director, Vaughan Hart, said: “It is welcome news that the number of construction companies entering compulsory liquidation in 2014 fell for a third consecutive year. This trend is further evidence of the tentative recovery being experienced in the industry at this time. Contemporaneously, there are growing signs of fragmentation within the industry. There are still significantly fewer medium-sized and large companies operating within the sector than prior to the recession. Conversely, we’re seeing a steady increase in the number of small businesses operating within the Scottish construction industry.

“Rebuilding the industry’s skills base remains a critical priority. These trends suggest we need to continue to support the smaller firms with the necessary investment to encourage the recruitment and training of apprentices. That way we can keep the industry’s recovery on a stable long-term path.”

Analysis: Number of enterprises in the Scottish construction industry 2009-2014

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Scotland

Employment size

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0-9

10-49

50-249

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250 - 499

500+

TOTAL

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2009

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Construction of buildings

4,545

415

85

10

5

5,060

Civil engineering

1,025

200

60

10

5

1,300

Specialist construction

11,040

1,090

155

5

0

12,290

TOTAL

16,610

1,705

300

25

10

18,650

2010

Construction of buildings

4,375

490

115

15

5

5,000

Civil engineering

1,055

320

95

15

5

1,490

Specialist construction

11,135

1,285

185

10

5

12,620

TOTAL

16,565

2,095

395

40

15

19,110

2011

Construction of buildings

3,900

335

65

10

10

4,320

Civil engineering

920

190

40

5

5

1,160

Specialist construction

10,775

985

125

5

0

11,890

TOTAL

15,595

1,510

230

20

15

17,370

2012

Construction of buildings

3,810

340

50

10

5

4,215

Civil engineering

900

165

40

5

5

1,115

Specialist construction

11,150

1,000

120

5

0

12,275

TOTAL

15,860

1,505

210

20

10

17,605

2013

Construction of buildings

3,490

350

55

10

5

3,910

Civil engineering

920

165

40

10

0

1,135

Specialist construction

10,930

1,080

115

5

5

12,135

TOTAL

15,340

1,595

210

25

10

17,180

2014

Construction of buildings

3,515

335

60

10

0

3,920

Civil engineering

985

165

45

5

0

1,200

Specialist construction

11,120

1,045

120

10

0

12,295

TOTAL

15,620

1,545

225

25

0

17,415

Change: 2014 vs. 2009

-990

-160

-75

0

-10

-1,235

Change: 2014 vs. 2009 (%)

-6%

-9.4%

-25%

0%

-100%

-6.6%

Construction of buildings: Change 2014 vs 2009

-1030

-80

-25

0

-5

-1,140

Construction of buildings:

Change 2014 vs 2009 (%)

-22.7%

-19.3%

-29.4%

0%

-100%

-22.5%

Civil engineering:

Change 2014 vs 2009

-40

-35

-15

-5

-5

-100

Civil engineering:

Change 2014 vs 2009 (%)

-3.9%

-17.5%

-25%

-50%

-100%

-7.7%

Specialist construction: Change 2014 vs 2009

+80

-45

-35

+5

0

+5

Specialist construction:

Change 2014 vs 2009 (%)

+0.7%

-4.1%

-22.6%

+100%

0%

+0.04%