Research by the group shows that a quarter of chief execs are “very confident” about business growth over the next 12 months, an increase of 10 per cent on the previous survey a year ago.

But while half of those surveyed said they expected their industry to recover this year, 16 per cent said it wouldn’t happen until 2011, and three-quarters said they were implementing a cost-reduction plan this year.

Six in 10 respondents said they expected more red tape to come from government this year, while the top two other perceived threats were exchange rate volatility and macroeconomic imbalances.

Ian Powell, UK chairman of PWC, said: “Growth expectations have been severely impacted by the challenges of the financial and economic crisis and the fears of a protracted recession are beginning to recede.

“However, there remain significant variances in UK business leaders’ short term and long term outlooks, perhaps as a result of concerns about how UK public debt levels are reduced and the continued limitation in lending.

The survey also found that nearly half of UK bosses pan to take on extra staff this year.

Powell added: “The upturn in employment prospects will be widely welcomed but this news must be tempered given that the bounce-back may be a response to employment cuts made in the UK over the last 12 months.” 

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