The UK faces a "long and difficult" path back to full employment, with up to two million new jobs needed to be created to return to pre-recession levels, according to a new report.
The IPPR think-tank said the public sector had been filling in for insufficient private-sector job creation during the last 20 years, a trend which will have to be reversed because of the Government's spending cuts.
Forecasts of 1.5 million jobs being created over the next five years will not be enough to replace those lost in the public sector and bring down unemployment, the report said.
The report, published ahead of new unemployment figures, warns that a slow recovery in the labour market increases the risk that people will become discouraged from work and permanently leave the workforce as their skills become redundant.
Regional disparities in employment growth over the last 20 years were found, with employment increasing by 27% in London between 1993 and early 2008, but only by 10% in the north-east and north-west.
The study predicted that the vast majority of jobs created over the next decade will come in the private service sector. Most jobs created in the UK over the next decade will be skilled while traditional low-skilled jobs will continue to disappear, replaced by more work in areas such as social care and personal services, said the IPPR.
The report also warned that some groups, in particular those with few or no skills, people with a disability, some ethnic minority groups and older people who previously worked in low value-added declining industries, will be particularly disadvantaged in the labour market in coming years.
Tony Dolphin, of IPPR, said: "Promoting a speedy return to full employment in the UK should be a priority for the Government. There is little evidence to suggest the private sector will be able to meet the challenge over the next four years without help from Government.
"Cutting corporate tax rates, deregulation and the creation of new Enterprise Zones are an inadequate response to the challenge. The Government should work with others, including skills providers and welfare-to-work providers, to do more to support growth in the short-term and to avoid the problem of discouraged workers leaving the labour market by doing more to encourage retraining, to improve job-matching and to get the long-term unemployed back into work."
A Department for Work and Pensions spokesman said: "We always said that the recovery would be choppy. We do not underestimate the scale of the challenge that we face to help people into employment.The Government is committed to support the economy and encourage businesses to invest and create jobs. The new Work Programme is now up and running and will offer jobseekers flexible support tailored to their needs to help them into employment."