According to the latest CIPD Labour Market Outlook report, employment levels should grow steadily throughout the remainder of the year.

Net employment intentions – the difference between the proportion of employers that intend to increase and decrease total staffing levels rose to +7 in the third quarter of 2012, compared to +5 during the previous 3 months.

However, the research did show a decrease in private-sector recruitment intentions, falling to +18 from +28 in the last quarter.

On the other hand, net hiring prospects in the public sector improved from-36 to -17 during the same period.

The report also focused on recent increases in part-time and temporary employment, and the Chartered Institute of Personnel and Development (CIPD) predicts that these trends will continue for the remainder of the year.

It found that 24% of employees will be hired on part-time working arrangements, while 21% of employers said that they will be increasing the proportion of temporary workers during the next 12 months.

Temporary employees made up more than a third of the total rise in the number of employees in the three months to August 2012 according to the most recent official statistics and employers cited the uncertain economic outlook (37%), the wish to lower short-term costs (25%), and fitting in with the business cycle (30%) as the key reasons behind the shift to temporary employment.

The CIPD warned that this trend would increase the number of underemployed people – those who work part-time because they cannot secure full-time hours.

Commenting on the findings, Gerwyn Davies, Labour Market Adviser at the CIPD, said:

“The shift to more part-time and temporary employment looks set to continue to drive the jobs market further along the road to recovery. However, while this may drive up employment levels to reach new heights in the coming months, it may also continue to put downward pressure on the living and working standards of an increasing proportion of employees. Employers’ focus on cost and risk will continue to squeeze wage growth for most employees, and may compel an increasing number of people to work fewer hours in less secure forms of employment.

“This may lead to even higher employee retention rates, which have also risen to recent highs; as an increasing number of employees stay put for fear of either losing their jobs or joining a firm on less generous and secure terms than the ones they currently enjoy. For most, work in some form will be better than no work at all.

“However, many employees and jobseekers could be forgiven for being sceptical about the strength or security of the employment market recovery while they continue to have to settle for part-time or temporary work. The sustainability of the recovery, supported by growing consumer confidence, may well depend on the extent to which firms are able to convert these part-time and temporary jobs into more full-time and permanent roles”.

Finally, the report also indicated that overall business confidence levels are varied, with 61% of private sector companies claiming they are either confident or fairly confident about the growth prospects of their organisation.

However a quarter of private sector firms did not predict that their fortunes would improve at all next year.