Contractors and other professionals will have to rein in their spending as some companies cut hours, one expert has said.

Joshua Bamfield, director at the Centre for Retail Research, said that due to the spending cuts, many firms are cutting back on employee's hours as an alternative to making redundancies.

"It shouldn't always be seen in terms of the number of people on the dole; it can simply be that people aren't being allowed to work the same number of hours as they want," he said.

"It keeps people in jobs, so that's good, but the other side is that it makes life difficult."

According to findings from the Office for National Statistics, the employment rate was 70.5 per cent during the final quarter of 2010.

Additionally, the unemployment rate was seen to be 7.9 per cent, affecting 2.49 million people.