SME recruitment rate drops

Employers are less optimistic about creating new jobs than at any time since 2004, according to a survey by the Chartered Institute of Personnel and Development (CIPD).

The research revealed that the balance between those companies intending to recruit and those planning on laying staff off had fallen from +41 a year ago to +2.

"The year after the impact of the credit crunch was first felt saw the UK labour market move from a state of buoyancy to one of stagnation," said CIPD chief economist John Philpott.

"We are now at the start of a period of contraction, with jobs being lost, new jobs hard to come by and, as this week's official statistics are set to confirm, unemployment on an ever sharper upward rise."

Meanwhile, a separate survey by the CBI also revealed that large numbers of small business owners were starting to make widespread redundancies.