A construction site by the Finnoo metro station in Espoo on 2 June 2023. Statistics provided to Helsingin Sanomat by Asiakastieto reveal a marked increase in the number of bankruptcies in the construction industry. (Heikki Saukkomaa – Lehtikuva)


AS MANY AS 270 construction companies were declared bankrupt in the first five months and change of this year, reveal statistics compiled for Helsingin Sanomat by Asiakastieto.

Helsingin Sanomat on 20 June reported that the rate of bankruptcies has picked up as the year has progressed, with roughly 150 constructions going bankrupt in the first three months of the year and about 120 in the little over two months that followed.

Overall bankruptcy petitions were submitted against 350 construction companies between early January and early May, signalling an increase of roughly 100 from the corresponding period in 2022. Some of the petitions remain pending in district courts, meaning they may not necessarily result in a declaration of bankruptcy.

The market environment has been hard particularly for residential construction companies, which have accounted for slightly over 100 of the bankruptcies, Jaakko Nors, a product manager at Asiakastieto, said to Helsingin Sanomat.

The casualties also include relatively large companies.

The largest bankruptcy of the year in the construction sector has been Saagatalot, an Oulu-based manufacturer of prefabricated homes that reported an operating loss of 2.1 million euros on revenue of 28 million euros in 2021.

Jouni Vihmo, the chief economist at the Confederation of Finnish Construction Industries (RT), told the daily newspaper that the industry is presently faced with three problems: sudden rise in costs, increasing cost of financing and sudden drop in demand.

Helsingin Sanomat wrote that although bankruptcies in general have started to increase following the expiry of special legislation that protected companies against bankruptcy during the coronavirus pandemic, the recent wave of bankruptcies signals more than a return to normal. Bankruptcies, it highlighted, have risen to a level not seen for 15 years, since the downturn set off by the global financial crisis.

Statistics from Asiakastieto reveal that some 1,200 Finnish companies have been declared bankrupt this year. Bankruptcies have been the most common in the construction industry and the second most common in the restaurant and accommodation industry.

Aleksi Teivainen – HT