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Posted by Sarah Putt

Recruitment activity in July continued to grow but at a slower rate than in the previous eight months, figures have shown, which could concern umbrella company users.

A report by the Recruitment and Employment Confederation (REC) and KPMG has found that the rate of expansion for both permanent and temporary vacancies weakened during this period.

Kevin Green, chief executive for the REC, claimed that this shows that there has been a "significant deceleration" in the employment market and the first indication that public-sector cuts are beginning to impact on the industry as a whole.

He said: "With 600,000 job cuts forecast in the public sector over the next year, the government must do everything possible to boost job creation in private sector – in particular by reducing business taxation and regulation."

This contrasts with recent comments by Richard Dodd, head of media at the British Retail Consortium, who has claimed that the UK market place is experiencing a degree of cautious optimism about the future.