Martin Bouygues, chief executive of the French group, said that Colas had suffered from a “very deep, very brutal recession” in Europe, losing up to half of its revenues in some countries.

He said the head count will fall from 7,900 to 5,500, as part of a restructuring that sees a new deputy managing director parachuted into its Eastern European business.

In the first six months of the year Colas delivered an operating loss of £39m on turnover flat at £4.16bn.

The decline reflected bad weather in the first part of 2010 and a steep decline in central European road work.

Profits at the main Bouygues construction arm fell 12% to £120m on sales down 5% at £7.6bn.

But the firm’s order book was 17% ahead of last year at £11.6bn.