THE WORSENING economic climate means 15 per cent of employers here plan to reduce staff numbers before the end of the year, according to the latest employment outlook survey from recruitment firm Manpower.

The report ranked the hiring intentions of employers in Ireland in the fourth quarter at a seasonally adjusted -3, the second weakest reading out of 80 countries surveyed, behind only Spain which had a score of -5.

The survey is based on interviews with 682 employers and revealed that more than a quarter, or 26 per cent, of construction firms plan to reduce their workforce in the fourth quarter.

This is the most pessimistic sentiment reading for this sector since the survey began in 2002 and reflects the turmoil facing residential and commercial construction.

A weak employment outlook was also found for restaurants and hotels, manufacturing, agriculture and fishing and finance and the insurance industry. In all, seven of the 11 sectors surveyed said they expected overall employee numbers to fall.

Firms in the pharmaceutical sector were the most optimistic, with 8 per cent saying they plan to hire in the coming months.

Retailers also expect to take on staff in the run-up to Christmas with the survey giving a reading of +2 per cent for this sector.

According to Graham Morris, staffing director with Manpower Ireland, heightened concerns in recent months over the strength of the economy, coupled with a drop in consumer confidence, had resulted in a dramatic weakening of employer confidence.

He said the most recent results also highlighted the extent to which the economy depended on the building sector.

On a regional basis, only employers in the greater Dublin area expect staff numbers to rise, and even then only by 2 per cent in the last quarter. In all other regions, the employers surveyed intend to reduce staff numbers.