Fewer construction firms in Northern Ireland go bust but payment a problem
The risk of going bust is fading for construction firms in Northern Ireland, but problems such as late payment persist, according to research.
Insolvency body R3 said the number of building companies at risk of going under had fallen every month bar one since May this year.
Now, just under 33% of building companies here are at risk of going out of business.
But in a reflection of the slow pace of economic recovery in Northern Ireland - relative to other UK regions - companies here still have the highest percentage risk of the entire UK. And the level of risk is going up in other parts of the UK, a spokesman for R3 added.
Michael Neill, an insolvency specialist at law firm A&L Goodbody in Belfast and chairman of R3, said: "The latest results are reason for cautious optimism.
"While Northern Ireland has marginally the highest insolvency risk for this sector in the UK, the gradual drop in recent months is welcome.
"The sector tends to be a reflection of the wider economic landscape, so this increasing financial stability is a positive sign."
But he claimed the sector still faced plenty of challenges and added: "Late payment, in particular, tends to be a big problem in the construction industry and can put unnecessary stress on the cash flow of a business.
"The practice also has detrimental knock-on effects down the whole supply chain."
Delays or problems with projects often multiplied and led to "serious financial problems," Mr Neill warned.
Construction companies in Northern Ireland have been reporting improved conditions in recent months.
The latest construction bulletin from the Northern Ireland Statistics and Research Agency indicated the total volume of construction output carried out here in the first quarter of 2015 increased by 6.5% compared to the previous quarter.
It was also 13.8% higher when compared to the same period last year.
And this week, figures from the National House Building Council revealed there had been 995 new homes registered in Northern Ireland in the three months to the end of October - a huge increase of 44% on the same period 12 months earlier.
But industry body, the Construction Employers Federation, said that while the substantial increase was welcome, there was still not enough houses being built to meet levels of demand across Northern Ireland.
Increase in construction output in first quarter over same time last year