The number of company liquidations in the State last year fell to a new 20-year low in 2006 with just 280 firms collapsing, according to a report published today.
A survey by Experian showed that 33 fewer firms collapsed last year. Over the last five years, 2001 was the worst year for company liquidations with 427 firms failing.
Newer construction companies in Ireland came under pressure last year. The report said that 3 out of every 10 insolvencies were in the building sector. Most of the companies involved were between 7 and 10 years old.
"The construction sector has been very strong in recent years, attracting a plethora of new companies anxious to share in the spoils, but it is a very tight margin business. The pricing of contracts and the tendering process is highly competitive, allowing very little room for error and forcing many smaller and newer companies out of the market, said Liam Reddy, director of Experian Ireland.
Mr Reddy said Ireland was faring far better than the UK, where liquidations had increased by 10 per cent last year and reached the highest rate in ten years.
Despite Ireland's relatively positive performance Mr Reddy says there is no room for complacency. "The number of companies which went into examinership in 2006 doubled (from 4 in 2005 to 8 in 2006) and there was an increase in the number of companies entering receivership up from 14 to 16.
He said older, more established companies did not feature strongly in liquidations last year.