Construction industry collapses surge as sector battles inflation, cash flow limitations and the COVID hangover

Construction company collapses have surged over the last 12 months, as Australian builders battle the end of COVID-era economic stimulus, vulnerabilities in long-established payment models, and the impact of rapid inflation and interest rate rises.

Data released by the Australian Securities and Investments Commission (ASIC) this week shows 7,578 companies entered administration or had an external controller appointed for the first time in the 2022-2023 financial year to June 18.

By comparison, 4,912 collapsed in the year prior.

Businesses in the construction sector saw the greatest increase by number of any sector over that period, with 2,117 going entering administration or external control, compared to 1,284 in 2021-2022.