Kier Group, the commercial and residential property developer and contractor, is to cut more than half of the 600 employees in its residential division owing to the "very cautious" outlook for the housebuilding market next year.

Four out of its five residential offices are to close with a loss of about 350 jobs. Kier said that, in spite of "very tough" market conditions for both housing and property in general, full-year underlying profit would be in line with current market expectations and ahead of last year's result.