Pictured: Neil Pountney, managing director of Emprima Ltd

With Britain's construction industry looking to encounter another turbulent year, during which it is expected that output will fall by five percent, leading researchers have warned that more "vulnerable companies" will face the threat of being taken over by rival competitors.

According to the latest assessment of the UK construction management market, carried out by Plimsoll Analysis, there is a growing gulf between strong and weak companies - with the likelihood that the sector will see "increased failures and takeovers" as economic uncertainty weighs on the market in 2012.

The report, which has individually assessed each of the top 161 companies in the UK construction management sector, suggests that 26 companies are likely to change hands in the next twelve months, while the fact that the year has started with 34 companies already in trouble is the clearest indication yet that 2012 is set to be another turbulent year.

In fact, during the last two years more than 5,000 construction sector companies have gone bust and, in the opinion of Jonathan Hook, head of engineering and construction at business advisers PricewaterhouseCoopers, "the trend shows no sign of abating." He said that there had been a six percent jump in insolvencies last year compared to 2010, when 2,527 construction firms fell into administration.

Neil Pountney, managing director of Emprima Ltd, the Solihull-based construction consultants, which has been given a "strong" rating in the Plimsoll report, commented: "A construction industry weakened and flat on its face through haemorrhaging profits will not serve the nation very well in its time of need.

"Unfortunately, present market conditions will not be short-lived and, if anything, they are likely to deteriorate in the medium term. So faced with such challenges, the industry has to be more pro-active in finding a new way through the malaise in which it now finds itself."

Mr Pountney, whose company has created a niche for itself by repeatedly finding ways on large complex projects to procure delivery to exceptionally high quality standards within challenging timescales, added: " Too many in the construction industry are hanging on for grim death to the status quo of outdated attitudes and mediocre standards in the mistaken belief that they cost less and that they will support a suicidal reduction in margins demanded by the marketplace.  

"Instead they merely produce a "double whammy" - requiring a large amount of cash to deal with their inefficiencies whilst overseeing the creation of an increasing number of dissatisfied customers who are ever more looking to find a new way for their business with better alternatives."

Mr Pountney said: "Unpalatable as it may seem, previous boom years - when work was plentiful - lulled the industry into lackadaisical attitudes, which became acceptable and regarded as the norm.  As a result, our up-and-coming leaders were not driven to continually seek out excellence and find a way to give their clients the edge necessary for them to prosper in their own commercial world.

"World standard attitudes, which are around in pockets, need to be mustered if the industry is take its true place in supporting the spark of a recovery when one eventually occurs, as surely it will," he added.

According to a report from the Construction Products Association, construction output will fall by 5.2 percent this year, followed by a flat year in 2013 and a return to growth in 2014. However, the Association warned that by 2014 output would be down 12 percent on peak levels achieved in 2007.