England under-21 coach Stuart Pearce, who is set to take charge of Britain's Olympic team next year in London, has signed a new contract.

The 49-year-old former England defender, who first joined The Football Association in 2007, was given a two-year deal despite his team being eliminated in the group stage of the European under-21 championship last month.

Pearce also works on Fabio Capello's coaching staff with the senior side.

''Continuity is vital as we continue to build our club ethos, and Stuart is an important member of the England coaching structure,'' FA chairman David Bernstein said.

The FA has previously indicated that Pearce will coach Britain's first Olympic football team, although the appointment is yet to be confirmed.

The FA is administering the team and set to provide the players after the Scottish, Welsh and Northern Irish associations said they won't be part of the side because of fears it would jeopardize their independence within FIFA.