Job-creation prospects are the worst they have been for more than a decade, the director of the Small Firms Association has claimed, following the publication of its ninth annual employment survey, writes Chris Dooley

Mr Pat Delaney said the economy could no longer create jobs as quickly as it was losing them and another "brain drain" was on the cards.

The survey of more than 1,000 association members across different sectors showed that employment creation in the private sector had hit "a brick wall", he said.

Its main findings included:

Just 38 per cent of respondents had vacancies, compared to 43 per cent a year ago and 63 per cent in 2001 ;

Projected new jobs were down from 36,238 last year and 64,000 three years ago to 17,420 in 2003;

Demand for IT workers was down 83 per cent and for foreign workers down 56 per cent.

More than half the companies surveyed, said Mr Delaney, had cited unrealistic wage expectations for their failure to create jobs, while 42 per cent had said lack of skills was another difficulty.

"For the fourth successive year small companies will create less new jobs than the previous year."

In other significant findings, 9 per cent of the respondent companies said they would make staff redundant over the next year, while 12 per cent planned short-term lay-offs.

The companies surveyed all have fewer than 50 employees. The results, said Mr Delaney, were the worst since the association had begun its annual employment surveys.