The financial stress within construction firms caused by the credit crunch is made stark in the latest official insolvency figures. And the problems facing the sector are being increased as property firms collapse in massively swelling numbers.

Between July and September this year there was an increase of almost two thirds in the number of construction firms falling into receivership, administration or company voluntary arrangements in England and Wales, compared with the same period a year ago.

With regard to receiverships there were 29 in the latest quarter compared with just 7 a year ago.

Meanwhile there was a 60% jump over the same period in creditors’ voluntary liquidations within the construction industry.

But more worrying is the carnage in the real estate market that is the provider of so much work for the construction sector.

Here almost seven times the number of firms fell into receivership, administration of company voluntary arrangements in England and Wales in the third quarter of this year compared with the same period in 2007.

With large sums often owed by property companies, there will be increasingly large financial holes appearing in the accounts of more and more construction firms. These problems will feed through adding to the financial stress within the construction industry.

The 1.5% base rate cut by the Bank of England may provide some cheer. But without that being passed on it seems clear that construction firms will be pushed to the wall in increasing numbers as the downturn in workload adds to the pain resulting from the credit crunch.