UK technology companies are more bullish about hiring new talent than the average for private sector businesses, according to a new employment index.

The KPMG/Markit Tech Monitor shows that just under half of tech firms plan to take on at least one member of staff in the next 12 months.

It also shows that current hiring trends in the sector are close to their strongest level in three years.

The trend is supported by a steep increase in new work and ultra-slow cost inflation, factors which mean business activity is only marginally lower than a 10-year peak at the end of 2013.

Tudor Aw, head of technology at KPMG, said: “All the data in this report point to a UK tech sector that is in rude health, and increasingly optimistic in its outlook on business activity and recruitment plans.”

Tim Moore, senior economist at Markit, added: “UK tech companies clearly punch above their weight in terms of contribution to UK GDP growth.

“The latest survey results will be reassuring to policymakers given the importance of the sector to the sustainability of the economic recovery.”