One in 10 small firms plan to recruit new staff in the first three months of the year, according to the Small Firms Association (SFA).
The SFA said another 64 per cent of companies hope to hold current staffing levels this year.
Association director Avine McNally said small firms have shown the capacity to create employment in the past, and will do so again if given the right economic conditions.
"While firms may be reluctant to recruit based on a number of issues, mainly economic and financial uncertainty, these figures are a positive move in the right direction and hopefully these figures will increase as the year progresses," she said.
A total of 677 companies employing 14,237 people responded to the winter jobs sentiment in December.
It showed that while 12 per cent of firms increased their employee numbers in 2010, there was a drop in staff levels towards the end of the year as bosses felt uncertain about Ireland's economic future.
"The survey shows that the rate of job losses, reduction in lay-offs and employee hours has slowed," Ms McNally said. "This is a reflection of the series of actions which have been taken by many small firms to reduce costs and retain jobs.
"While many small firms will still retain a recruitment freeze, 13 per cent of respondents indicated an increase in the recruitment of temporary staff and 11 per cent indicated an increase in permanent staff over the first quarter of 2011."
PA