A Senate inquiry into construction industry insolvency has heard some sub-contractors are afraid to speak up when they are being ripped-off.

The inquiry is looking into the high rate of construction industry insolvency in the state, which routinely leaves sub-contractors out of pocket when larger firms go down.

In many cases, the smaller companies cannot support themselves on short notice, leading them to go under as well.

In one prominent case this year Tagara Builders went into liquidation, dumping $70 million in projects across South Australia and owing more than $20 million to backers and sub-contractors.

The hearings heard this week that sub-contractors are sometimes intimidated into silence when they are not getting paid, as they fear their work will dry up.

SA’s Small Business Commissioner John Chapman says intimidation of sub-contractors was widespread.

He told the hearings that he was looking into whether intimidation in the industry could be made an offence.

“I'm seeking some Crown law advice on that but ultimately it will be a government policy decision as to whether the Government goes down that path,” Mr Chapman said.

“It certainly is in terms of the payments area and using the act that we have, which the Government's already put in place — that one of the barriers in this state certainly seems to be; ‘If you use that act, you won't get any more work’.”

The inquiry has heard the industry is bracing for more insolvencies in South Australia's construction industry in the next six months.

Unions say this will see many more within the industry having trouble getting their bills paid.