According to a survey released by the Chartered Institute of Personnel and Development (CIPD), fewer than a third of UK firms are taking on new staff and are expected to increase from 22% to 27% this year.
The number of employers planning job losses increased between the second and third quarters of this year. And the survey of 1,200 UK firms showed a big dip in work prospects compared with 37% of firms taking on staff earlier this year and 58% when the survey began in 2004.
John Philpott, chief economist at the CIPD, said: "Last December I forecast that 2008 would be the UK'S worst year for jobs in a decade. I thought there would be some growth in employment- though only a third of that enjoyed in 2006 and 2007 and not enough to present a rise in unemployment- resulting from a squeeze on recruitment and a limited increase in the number of redundancies. Although this forecast was initially considered pessimistic it now looks relatively optimistic in comparison with the prevailing mood of doom and gloom. My initial view was based on the assumption that interest rates would fall in the second half of 2008. But this has been made difficult by a bigger than anticipated spike in food and fuel prices, making the outlook for jobs worse than originally expected.
Even if we avoid the scale of jobs fallout suffered in previous downturns, the era of the candidate's recruitment market is already over, with people in work becoming increasingly anxious that their P45 might be on its way soon.
With pay pressure still subdued, mounting job insecurity is being compounded by a significant squeeze on workers' real incomes."
According to the recent study, average pay rises are expected to rise by 3.7% in the coming months, in line with recent settlements.
Chris Crawford is the MD of BD Recruitment a specialist recruiter for creative manager jobs, ppc jobs and c# jobs, based in Manchester, UK.