Public sector hiring intentions have become negative for the first time since 1994, new research has revealed.
The Manpower Employment Outlook Survey found net employment intentions for the public sector have dropped to -1%, down from 0% in the previous quarter.
But the survey of 2,100 UK employers found the country’s net employment outlook has remained the same at 1%.
Mark Cahill, managing director of Manpower, said: “The impact of government-imposed spending cuts on both public sector departments and private sector outsourcing is casting a shadow over the UK’s gradual recovery. In the private sector, there is a real need for immediate and long-term growth to boost the UK’s prosperity.”
The Chartered Institute of Personnel and Development has warned 500,000 public sector jobs could be lost over the next five years.
Alan Clarke, an economist at BNP Paribas, added: “For the public sector, which has reported subdued hiring prospects so far this year, the survey indicates the third quarter of this year is the ‘calm before the storm’ of widespread job cuts.
“While we’ve enjoyed some initial light relief as the economy emerges from recession, as these findings illustrate we are not on our way to a boom just yet. Rather, the labour market is maintaining its current pedestrian pace of hiring until the UK has a stronger economic pulse.”
The survey also revealed the construction sector is continuing to struggle with a net employment outlook of -5%.
Meanwhile, the finance and business services sector was the most positive industry for the third consecutive quarter, with net hiring intentions of 7%.
Manufacturing has also improved for the fourth consecutive quarter to reach 2%.