An employer's organisation has raised concerns about the impact of the government’s public sector cuts on private sector business.

Commenting on the Recruitment and Employment Confederation's latest employers' survey, JobsOutlook, the organisation pointed out that economic uncertainty is dampening permanent hiring intentions, while increasing the demand for flexible staffing.

The monthly survey of 600 employers found that 67 per cent of employers said they had short-term plans to increase their permanent workforce over the next three months, compared to 74 per cent last month. With regards to longer prospects, 49 per cent of employers expect to expand their permanent hires over the next year, compared to 66 per cent last month.

A REC news release said: "The impact of the public sector cuts on private sector jobs remains a concern. A total of 20% of private sector employers now say they will have either a quite serious or serious impact on them."

In a TUC blog, policy officer Paul Sellers drew attention to a two-fold impact:

• loss of trading opportunities in the public sector

• loss of consumer demand as public sector workers are displaced, or fear that they will be displaced.

"No surprise then that employers organisations such as REC are belatedly starting to worry about Government policy," he said.