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The number of companies expecting to make people redundant in the first quarter of this year is expected to rise sharply.

Figures from KPMG and the Chartered Institute of Personnel and Development show private sector jobs might help offset public sector cutbacks - but overall two out of three employers expect to have less staff in 2011 than they had in 2010.

There is a sharp difference between public and private sector - 66 per cent of government organisations expect to cut staff in the first three months of the year.

Meanwhile the outlook for jobs in the private sector varies widely. About 20 per cent of manufacturing and services companies are expecting to increase headcount in the first quarter.

Gerwyn Davies, public policy advisor at the CIPD, said: "While private sector jobs generation is encouraging it's more important than ever that the Government continues its growth efforts in the private sector so as to offset the jobs gloom in the public sector."

More employers are expecting to cut jobs than at any time since the survey was started in spring 2004.

Overall the numbers, taken from a survey of 750 employers, showed the difference between bosses expecting to hire staff versus those expecting to let people go has fallen from +11 to -3 since last quarter.

You can download the CIPD's employment numbers here.

The gloomy jobs market is also hitting pay settlements. Average pay settlements in the public sector are expected to fall 0.3 per cent, compared to 2.3 per cent increases in the private sector. ®

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