The division designs and installs M&E services on commercial and industrial projects but has suffered from a dramatic fall in workloads and margins.

Morfitts is part of J H Shouksmith and Sons Ltd which also has five divisions employing over 100 people in York, Leeds, Sheffield, Bolton and Gloucester.

None of the other divisions will be affected by the closure of Morfitts and Morfitts Maintenance Services will also continue to operate as normal.

Morfitts will be honouring all its current contracts but will not take on any new work.

Staff were told of the closure yesterday and redundancies will start after a 30 day consultation period beginning on 4 January 2012.

John Miller, Managing Director of J H Shouksmith said: “We are obviously very sad to have to take this decision.  We have looked at every possible option available to be able to keep Morfitts operating, but without success.

“The service provided by Morfitts compared to the other Divisions is much more technical and cost intensive to deliver, and in today’s brutal market the risks are that much higher.

“We are not prepared to compromise the Morfitts service and cannot deliver it for the price demanded in today’s market.

“Whilst this has been an immensely difficult decision to take, it is absolutely necessary.

“The other five Divisions have also undergone difficult trading conditions, but because of the type of work they undertake the risks are less and they are much better placed going forward.

“By taking away the draw on resources demanded by Morfitts over the last few years, it will allow us to refocus on developing the other five Divisions and support them in their plans to continue to deliver an excellent service to their existing clients and develop positive relationships with new ones.”

Richard Shouksmith, Chairman of J H Shouksmith added: “The fall in volume of work in the construction industry has been the most dramatic I have ever seen, and it has affected our business significantly.

“Whilst this decision has been very difficult to make, our priority is to protect the future of the business as a whole.

“New clients continue to be won by the other Divisions, our reputation for delivering sustainable solutions continues to grow and there are a number of significant opportunities on the horizon.

“This, together with the continued operation of Morfitts Maintenance Services, puts the company in a good position to move forward and be in a healthy state to operate and grow when the economy recovers.“