That is the warning from accountants PwC in a gloomy report this morning which predicts that half a million private sector jobs will go across all industries as gross output falls by £46bn a year by 2014/15.

Construction will be the hardest hit industry but PwC believe jobs will be created in other areas like outsourcing as new opportunities arise and save the country from a double-dip recession.

John Hawksworth, chief economist at PwC, said: “The construction sector could see an output loss of around 5% leading to around 100,000 job cuts.

“This reflects the greater exposure of this sector to cuts in public sector capital investment, which are particularly severe.”

Jon Sibson, partner and head of public sector at PwC, added: “A sector likely to see growth opportunities from spending cuts is outsourcing, and not only in back office services.

“Government and public sector organisations will look to reduce their non-core and fixed cost operations by increasing the use of private and voluntary sector organisations for the delivery of front-line services.”