A Positive Sign of Recovery for America’s Building Industry, According to Creditsafe
Credit analysis of 1.7 million U.S. construction firms shows consistent improvements in credit ratings and payment performance.
ALLENTOWN, Pa. (September 30, 2015)—Credit risk is improving among U.S. construction firms, according to a new report from Creditsafe, the world’s most-used supplier of online business credit reports.
Of approximately 1.7 million construction companies analyzed during the past year, the report found that the high-credit-risk category is now 5.8 percent smaller, whereas the low credit-risk group has grown by 1.7 percent.
Also important to note is that America’s construction firms are paying their bills two days faster, on average, a key indicator of a company’s overall improving cash flow, financial health and credit worthiness.
“What this data tells us is that the construction industry in the U.S. is getting stronger,” said Matthew Debbage, CEO of the Americas and Asia-Pacific, Creditsafe. “We can see that overall credit ratings are improving, construction firms are paying their bills more quickly and there are fewer legal filings on record, such as tax liens and bankruptcies. All of these are promising indicators that the industry is getting stronger.”
Meanwhile, the report reveals that there are 2.3 percent fewer U.S. construction companies in business compared to last year. Debbage explains that this contraction is actually a positive growth sign because when the economy grows, we traditionally see weaker companies eliminated, as the stronger, healthier players emerge.
Founded in Norway in 1997, Creditsafe, Inc. is the world’s most-used supplier of online business credit reports. Nearly 5,000 companies in the U.S. use its credit reports, ranging from small businesses to large, global concerns like Staples, Ryder and Nestle. Its U.S. operations are headquartered in Allentown, Pa.
For more information call us at (855) 551-6903