The result may mean good news on interest rates as pressure on wages, and in turn inflation, could also begin to ease.

Almost two out of every three UK firms are still reporting skills shortages in August, but this has declined from 71% in May, according to the survey of 518 companies by Reed Personnel Services (RPS).

Firms competing in the labour market for scarce numbers of skilled workers has been one factor driving up wages.

Wages growth has been running at an annual rate in excess of 5% in recent months with the Bank of England identifying it as the main factor providing upward pressure on interest rates.

'Soft landing'

James Reed, chief executive of RPS, said: "Perhaps this is the first indication the economy may make a 'soft landing', combining the current lower rate of growth with lower inflation."

Manufacturing skills shortages sharply down

The manufacturing industry showed the biggest change with 60% of firms reporting skills shortages down from 76% in May, reflecting the sector's slide into recession.

Meanwhile, firms reporting skill shortages in the still-buoyant services sector fell by just 8 percentage points to 67%.

The public sector was the only sector that did not report a sharp drop in the skills shortfall with 68% of organisations saying it is difficult to find qualified staff.