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Occupied space in the UK office market is set to grow, despite the cuts to public administration jobs announced in the Comprehensive Spending Review, according to new research by DTZ.

The global real estate services firm forecasts that total UK occupied office space in the major markets will increase by 2 million m² by 2014. Strengthening demand from the recovering private sector will more than outweigh the effects of public administration job cuts on regional office markets.

The public administration workforce is expected to diminish by 11% between 2010 and 2014. DTZ calculates that this will result in 711,000 m² of office space becoming vacant across the major UK office markets. However, public sector office based employment is small, accounting for 19% of total UK office employment, compared to 81% private sector employment.

As a result of employment growth in finance and business services, DTZ forecasts that the finance and business services sector office requirements will increase by 2.8 million m² by 2014, offsetting the public administration cuts and increasing total UK occupied office space in major markets by 2 million sm² (4.4%) over the next four years.