A new survey reveals Tasmanian businesses are preparing to employ fewer people in the opening months of this year.
The business confidence survey looked at the hiring intentions of local businesses.
The Tasmanian Chamber of Commerce found employers shed staff in the final three months of 2012 and expect to make more cuts this year.
The chamber's chief economist Phil Bayley says the result reflects a broader economic slump in the middle of last year.
"It usually lags what's happening in the rest of the economy," he said.
Employers also expect to cut wages and overtime, and believe sales and business conditions overall will remain sluggish.
But they are expecting to invest slightly more in buildings and equipment.
In a National Australia Bank survey, businesses reported tough trading conditions in January.