Wellington, Dec 16 NZPA - The outlook for employment was better than expected, with most businesses in a recent survey saying they were doing alright overall, an employers' group said.

The Employers and Manufacturers Association survey found that just 2 percent of respondents were fighting for survival despite the slowing economy.

Of the 730 responses, just over half planned to keep staffing at current levels next year, and 14 percent intended to increase staff numbers.

Twenty percent said they would not replace staff when they leave, and the remaining 2 percent forecast redundancies next year.

The response seemed to be overly optimistic given the gloomy economic outlook for 2009, said EMA employment services manager David Lowe.

"What we may be seeing in the run-up to Christmas is indeed a shallow recovery from a shallow recession as (Reserve Bank Governor Alan) Bollard has noted, but our expectation is that this won't continue next year," he said.

"The recession we have had was largely driven by high interest, petrol and food prices. The recession we're about to have will result from a lack of export orders and falling commodity prices on world markets."

Currently, 46 percent of businesses were keeping staff numbers steady, 23 percent were not replacing staff who leave, and 18 percent were carrying out redundancies.

Sixty-eight percent of businesses reported that they were able to maintain their current business and staffing structures.

There was strong support among employers surveyed for the new law enabling small businesses to sack a new employee within a 90-day probation period without explanation, and without risking a personal grievance case.

Respondents were divided about KiwiSaver, with half wanting it changed to become fairer, and the other half wanting no further changes.

Among other findings in the survey, 80 percent wanted access to ACC cover from either the Government or the private sector, and employers gave an average pay rise of 4 percent to staff on individual contracts and 3.8 percent to unionised employees.

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