Gordon Brown delivered a “Budget for stability” which offered few blows and some hope for recruiters.

Recognising that in the tight employment market growth may be hampered by lack of staff, the chancellor announced a range of incentives to encourage the hard-to-reach unemployed to return to the job market.

Government help for start-up and growing businesses has been reduced, however. The chancellor removed his 2002 concession of zero rate corporation tax on the first £10,000 of small companies’ profits, after the move led to a wave of individuals incorporating as limited firms. These will now be taxed at 19%.

Gareth Osborne, chief executive of industry trade body the Recruitment and Employment Confederation, said: “We would argue that many smaller businesses have only been able to develop as a result of this tax concession and it seems a strange move when the government wants to encourage entrepreneurialism.”