The economy contracted by 0.3% during the last quarter of the year after growing 0.9% in the previous three months.

But construction bucked the general trend with a 0.3% rise in the final three months of 2012 following a 2.5% fall in the previous quarter.

The figures are provisional estimates and open to revision.

Civil Engineering Contractors Association director of external affairs Alasdair Reisner said: “Today’s figures show that while there has been a modicum of growth in the construction sector, the overall drop in GDP places the British economy on a knife-edge.

“Historically, negative growth in the economy dents investor confidence. Yet there are some investors that we will need to attract if we are to maintain and upgrade our national infrastructure.

“It is vitally important that the government continues efforts to free up investment in Britain’s infrastructure sector. A failure to do so will put our sector at risk of further declines, with a corresponding negative effect on the wider economy.”