New figures have revealed construction sales fell by more than 6% following the collapse of Carillion in January.

In its latest quarterly report, industry watchdog Creditsafe states since the firm's failure, sales within the sector have declined by 6.2% over the last three months.

Overall, the industry was hit with a total of £16,997,825 of bad debt in the last three months, while the average amount owed to construction companies from failed businesses was £27,820.

In addition, the sector has left a total of £100,181,901 of bad debt owed to other companies, with an average of £20,950 owed to companies from failed construction businesses.

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The picture isn't any better across the UK's 10 other business sectors, with the number of companies failing over the last three months rising by 28.3% to 4,567 compared with Q4 2017.

Overall, bad debt filed in the first quarter of 2018 reached £738.7 million, a rise of 366.1% year-on-year.

With the collapse of major firms such as Carillion and Toys "R" Us, which entered administration in February, Chief Executive Officer of Creditsafe Cato Syversen said these latest figures are "disappointing" following the previous three months of reported rises in sales and falls in bad debt.

"In the last three months, we have seen more than 1,000 companies fail, a rise of over a quarter," he said.

"Following the collapse of Carillion, the construction industry saw a fall in sales of 6.2%, a rise in debt owed to the sector of £4.3m, a 73.3% increase in company failures and 484 more CCJs (County Court Judgments).

"That is just the short-term impact in one sector. We are seeing similar challenges across other industries and it’s a waiting game to see what the mid to longer term future will deliver."

(LM/MH)