AAP

Australian employers are more confident about the future and their intention to hire more workers is at the highest level in 10 years.

The latest Hudson Employment Expectations survey found hiring intentions for the fourth quarter of this year rose by 12 percentage points, with a net 18.5 per cent of employers now planning to increase permanent staff.

It was the sharpest quarterly rise in the 10-year history of the survey, Hudson said on Wednesday.

"As we head towards the end of the year, it's becoming clear that Australia's economy has defied the pessimism of early 2009 and performed extremely well relative to its peers," Hudson chief executive of Australian and New Zealand Mark Steyn said in a statement.

"This is clearly reflected in the hiring intentions of Australia's business community."

All states and territories recorded positive shifts in hiring intentions for the December quarter, as did all 19 business and industry sectors.

New South Wales recorded the sharpest increase of the states and territories, largely driven by a resurgence in the housing market, the ramping up of government infrastructure projects and a pick up in retail spending.

Hiring intentions were up 13.5 percentage points to a net 17.6 per cent of employers.

"Construction is now the key driver of confidence in the state," said Mr Steyn.

The financial services sector, which was the hardest hit by the global financial and economic downturn, was the sector to show one of the best increases in hiring confidence.

Hiring intentions were up 20 percentage points to a net 19.1 per cent of employers.

"A steady improvement in local and global share markets and better than expected performance results in the major banks have seen employer confidence finally return to positive territory," Mr Steyn said.

The professional services sector showed an even sharper increase, rising 22.3 percentage points.

The latest Hudson report involved interviews with 5,053 employers across Australia.