Dr Stephen Gruneberg, Reader in Construction Economics at the University of Westminster, commented on an article for Construction News about predicting failure in contractors, after Carillion’s collapse. 

The article draws on this year’s CN100 ranking of the country’s biggest contractors, which has adopted new measures to foresee liabilities and stability. One of these measures is working-capital ratio, measuring short-term resilience.

Saying low working-capital cover makes life precarious for contractors, Dr Gruneberg commented: “One slip or a delay in receiving payment and it is a question of not being able to pay firms in the supply chain. No wonder firms are frequently in conflict.”

Construction News is a UK-based weekly publication that covers construction industry news, market intelligence and forecast and trend data. It also provides digital and event services. 

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