SMALL firms have been responsible for four in five jobs created in the past three years.

That is according to Neil Eames, Wessex Region development manager for the Federation of Small Businesses, who was commenting on the new IPPR report.

It found that 84 per cent of jobs created between the beginning of 2010 and 2013 were in small or medium-size businesses.

Mr Eames said: “We hear a lot about how small businesses are the engine of the economy and this research confirms this.

"Micro and small businesses have by far and away been the biggest job creators since the recession. Because of their innate flexibility, they also lead the way in providing a route back into work for the unemployed, with nine in 10 unemployed people either finding work in a small firm or starting their own firm.

"This report also shows the world of work is changing with self-employment, part-time and temporary work growing since the recession.

"This not only highlights the flexibility and dynamism of the private sector, but the pressures facing employers when it comes to hiring and retaining staff.”