Protecting the flexible jobs market in which IT contractors work should be a top priority for the new government, a trade association has insisted.

While reducing the deficit must be the number one goal, jobs in the public sector can still be saved if ministers undertake long-term reform of the system rather than just making short-term cuts, according to the Recruitment & Employment Confederation (REC).

It is through creating the right environment for businesses and individuals to prosper that Britain will begin to recover from recession and pay off its fiscal debt, the REC adds.

"We need a well executed programme of productivity improvement and innovation in the delivery of critical public services," said Kevin Green, the REC's chief executive.

However, Mr Green described the current hung parliament as a "political twilight zone" and admits that the action on these matters is likely to be a long and drawn-out process.

The REC's latest Report on Jobs found that job placements for IT contractors and other temporary workers increased at their fastest rate since January 2008.