According to construction market analysts, the cost of growth is often flanked by insolvencies and inflation. The fact is that despite robust demand, construction firms, civil and commercial, are feeling the squeeze stemming from thin margins. Construction remains the industry with the most company insolvencies in Australia, accounting for about a quarter of all cases in the 2025-26 financial year.

Coupled with other economic elements such as policy updates and market volatility, rapid expansion within a single industry’s sphere often leads to a cooling period owing to inflation and increasing costs. As far as insolvencies are concerned, this phenomenon is real for small and mid-tier civil contractors, who generally operate on fixed-price contracts that were established when markets were much more favourable.