The outlook for Black Country business remains generally poor, according to the latest quarterly economic survey from the Black Country Chamber of Commerce.
Manufacturers have reported a small upturn on exports, but confidence remains low for increased turnover and profits in 2006.
The service sector, which historically has compensated for the decline in manufacturing, has shown a steady decrease in optimism throughout the last year.
There is increased confidence in both turnover and profits for the last quarter of 2005 but cashflow confidence is declining with a percentage balance of 26 per cent of respondents to the latest survey expecting a decline in cashflow.
Keith Stanley, the Chamber's Walsall director and the man responsible for compiling the survey, said: "These figures should come as no surprise. Policies that are unfriendly towards businesses have a long-term corrosive effect.
"The vast majority of businesses have fewer than 25 employees. Keeping on top of paperwork presents a real problem to these companies. It dampens their spirit of enterprise."
He added that the Govern-ment's new crackdown on red tape could be a major step forward, but businesses would need to see real action soon to be convinced.
The final quarter of 2005 showed a small overall decline in business confidence, he said. ..SUPL: