The firms works mainly for Hull City Council delivering building and housing repairs under a 10-year framework contract.
But city council spending cutbacks are hitting the specialist, which has unveiled plans to lay off 70 of its 450-strong workforce.
In a letter to staff, KWL’s head of business Kevin Redmore said: “I have today met with the full-time and local trade union representatives and informed them that the company may have to make up to 70 redundancies across the business as a consequence of the economic downturn and projected reduction in budgets and workload from Hull City Council for 2012-13.
“I appreciate this will give all of you some concerns and uncertainty at this time.”
The Kingswood-based company is the council’s sole contractor for the repair and maintenance of the authority’s 29,000 council homes.