The consultancy's latest study of more than 700 firms found that while 47% of companies had cut their workforce size in the previous six months, only 30% think they will do so in the coming six months. It also found 60% had made hiring freezes in the past half-year, but only 38% said they would continue to do so in the coming six months.
Eight per cent of firms said they intend to increase the hiring of permanent employees - double the number that had done so six months previously.
Carol Hathaway, European head of strategic reward, Watson Wyatt said: "Organisations have reported widespread internal restructuring to realign themselves to the new economic reality. Businesses now have the opportunity to use this period of relative stability to turn their attention to embedding these changes through roles, reward, talent and engagement practices to truly reconnect their people to the business."
