New data from Lloyds TSB has revealed business activity was down fractionally in the West Midlands during April.
The slight decline, the first in five months, was attributed to a wider slowdown in the manufacturing sector.
More encouraging aspects revealed new business growth was sustained and employment rose at the fastest level since August last year.
The Lloyds TSB West Midlands Business Activity Index – which measures the combined output of the region’s manufacturing and service sectors – posted 49.8, down from 50.0 in March, its first sub-50 reading since last November.
New business continued to rise at a solid pace, however, while backlogs of work fell at the slowest rate in 11 months.
Moreover, employment growth accelerated to the strongest point since last August.
Output at West Midlands private sector firms was down fractionally in April, contrasting with an acceleration in growth of business activity across the UK as a whole. Data showed an expansion of activity in the service sector was offset by declining manufacturing output.
The slight fall in output occurred despite another increase in the level of new business placed with West Midlands private sector firms during April.
The latest rise in new work was the sixth in consecutive months and at a similar pace to the UK average.
Higher new business in the service sector contrasted with a drop in new orders placed with manufacturers.
Employment in private sector increased further in April, extending the current period of expansion to four months.
Furthermore, the rate of jobs growth quickened to the fastest since last August.
Andy Youngman, area director for Lloyds TSB Commercial Banking in Birmingham, said: “Business activity in the West Midlands was down fractionally in April, mainly due to a wider slowdown in the manufacturing sector across the UK.
“Despite this, a further solid rise in levels of incoming new business provides encouragement that this could simply be a blip.
“Employment levels also rose at the fastest pace since last August, highlighting a rise in confidence among the region’s companies over business prospects in the months ahead.”