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This rising confidence appears to have been translated into a boost in employment with 42% of UK business leaders planning to increase their headcount in the next 12 months. This response, combined with recent ONS unemployment figures showing a slight improvement, suggests the UK job market outlook is more positive than it has been for some time.

UK business leaders are more upbeat than their European counterparts when it comes to recruitment. In the Netherlands only 34% of CEOs expect to increase headcount, followed by France (30%), Italy (29%), Germany (27%) and Spain (9%) but while the UK is leading the European pack, further afield Brazil (61%), India (59%) and China (53%) are showing an even quicker return to bolstering their workforces.

Despite the positive outlook for employment, three-quarters of UK CEOs expect consumers will spend less and save more and, as a consequence, 63% plan to make some change to their business and a further 13% plan to make a significant change as they manage the impact of shifting consumer behaviour.

Since last year, a more positive outlook has emerged for the mergers and acquisitions market with 14% of business leaders (compared with 7% in 2009) now saying it is a route to growing their business, although this is some way behind pre-recession levels.

Business growth looks set to remain home grown as only 14% of UK CEOs in 2010 see new geographic markets as an opportunity to grow their business, compared with 22% in 2009 and 28% in 2008.

Ian Powell, UK Chairman and Senior Partner, PricewaterhouseCoopers LLP, said: "It is encouraging to see that UK CEOs are beginning, if somewhat cautiously, to prepare for an upturn."

But he added a note of caution: "The upturn in employment prospects will be widely welcomed but this news must be tempered given that the bounce-back may be a response to employment cuts made in the UK over the last 12 months."