6,400 construction firms will fail by mid-2009

More than 6,000 construction firms will fail by the middle of 2009, collapsing at a rate of 250 a week, according to a report by accountants BDO Stoy Hayward.

Construction (6,400 business failures) will be the worst affected industry sector, the firm predicts, followed by business services (5,700) and real estate (3,200).

The firm's Industry Watch report forecasts 32,300 business failures across all sectors of industry in 2009, up 50% on the predicted 21,900 by the end of 2008, and the highest recorded since 1992 when 33,900 firms failed.

BDO Stoy Hayward thinks that only 1,100 companies will be saved by the measures announced in the Pre-Budget Report.