A recruitment services firm has claimed that it has seen an increase in business in the industry.

LSM, which provides services including outsourced payroll, has reported a sense of renewed confidence in the sector.

The firm has seen an increase in the number of transactions it has processed for clients over the last three months. But chief executive Peter Allan (pictured) said recruitment was still vulnerable to a sudden change.

“The majority of our clients are forecasting continued strengthening of their markets. However, we are keeping a close watch on interest rates in view of the fact that aggressive action by the Bank of England could significantly tighten the cost of borrowing,” he added.