The jobs market is facing a "slow, painful contraction", with firms scaling back decisions on whether to recruit more staff against a background of global economic "turmoil", a new report has warned.
The Chartered Institute of Personnel and Development (CIPD) predicted that the employment situation will get worse for the rest of the year, while medium-term prospects were no better.
Fewer firms were planning to offshore jobs abroad and recruit overseas workers, while the private sector will grow at a slower pace in the next three months, it was suggested.
Confidence in the public sector remains low for the next three months and will get worse next year, said the CIPD after surveying 1,000 employers.
Gerwyn Davies, public policy adviser at the CIPD, said: "The figures point to a slow, painful contraction in the jobs market.
"Many firms appear to be locked in wait-and-see mode, with some companies scaling back on all employment decisions against a backdrop of increasing uncertainty as a result of the eurozone crisis and wider global economic turmoil.
"The good news resulting from this lull in business activity is that fewer employers are looking to relocate abroad or make redundancies.
"The downside is that recruitment intentions are falling, which will make further rises in unemployment therefore seem inevitable given that public sector job losses are outpacing the predictions made by the Office for Budget Responsibility.
"There is no immediate sign of UK labour market conditions improving in the short or medium term."
The report was published ahead of new unemployment figures on Wednesday which will show whether the youth jobless total has gone over a million.
© 2011 Press Association