The net balance fell from +6 per cent last month to -3 per cent in the latest report, as 31 per cent of employers now expect the economy to worsen and just 28 per cent expect it to improve.
Employers are still looking to hire, with one in five (19 per cent) planning to increase permanent headcount in the next three months.
Confidence in making hiring and investment decisions remains positive with a net balance of 10 per cent, but is at its lowest for the past year.
Kevin Green, REC chief executive, said: “The jobs market continues to do well despite growing uncertainty. However, this drop in employer confidence should raise a red flag.
“Businesses are continuing to hire to meet demand, but issues like access to labour, Brexit negotiations and political uncertainty are creating nervousness.
“The government must do more to create an environment where businesses have clarity.
“That means clearly laying out what Brexit plans look like and how employers can keep recruiting the people they need from the EU.”
The latest JobsOutlook survey of 601 employers also showed 40 per cent of employers had no spare capacity and would need to recruit to meet additional demand
It also found that more employers express concerns about a lack of appropriate candidates for construction jobs (both temporary and permanent) than any other area.