Photo courtesy Sagon Trucks
According to an article in the Wall Street Journal, about 250,000 of 1.7 million American construction firms rank as high credit risks, down by 5.8%. In addition, the number of firms classified as low risk increased by 1.7% to nearly 1 million.
These numbers are courtesy of Creditsafe Inc., a U.K.-based supplier of online business credit reports who assessed the firms.
In the report, Creditsafe also found that companies are paying their bills two days earlier than a year ago, down to an average of 9.5 days past the due date. Late payments are not uncommon in an industry that often has to deal with unpredictable weather or shortages of labor or materials.
The firm’s findings are also consistent with the “generally improving outlook for the construction industry.” U.S. construction recently climbed to its highest level since 2008 and home construction starts during the first four months of 2019 increased by nearly 14% from the same period last year. Also, employment numbers in the industry continued their steady increase since the recession of 2008.
Finally, Creditsafe reported that there are 2.3% fewer construction firms in business in America this year than last, a sign that the strong have survived and the weaker companies have fallen off.
Creditsafe used data from financial institutions, utility companies, and courts, among other sources. All companies defined as construction companies by the U.S. Department of Commerce were included in its research.
