Midland business leaders have welcomed a one per cent growth in GDP between July and September – taking the UK out of a double dip recession.
The economy returned to growth at its fastest pace in five years as Office for National Statistics (ONS) figures showed that gross domestic product grew one per cent in the third quarter of the year, ending three consecutive quarters of declining output.
City experts had expected a rise of 0.6 per cent. The actual figure is the biggest increase since the third quarter of 2007.
Job creation in the West Midlands is one of the factors that helped bring Britain out of recession, according to Birmingham Chamber of Commerce.
Chamber president Michael Ward said: "This news follows the announcement by the Office for National Statistics that the Greater Birmingham and Solihull Local Enterprise Partnership area experienced an increase in private sector employment of 16,300 in the year to September 2011.
"Our figures indicate that this trend has continued and the private sector can give itself a pat on the back for its tremendous resilience.
"The manufacturing sector is recovering well in the region although the service sector and the construction sector continue to give rise for concern.
"The economy is still volatile and weak – proved by the significant impact a single Bank Holiday or bout of bad weather can have."
Nationally, the largest contribution to the surge in GBP came from the powerhouse services sector, which makes up around 75 per cent of the total economy and grew at 1.3 per cent, following a 0.1 per cent drop in the previous quarter.
But the bounce-back was largely driven by one-off factors, the ONS warned, such as clawed-back activity lost to the extra bank holiday for the Queen’s Diamond Jubilee and a slight lift from the Olympics.
The figures are preliminary estimates and subject to revision.
Manufacturing contributed the most to the increase in industrial production, followed by water and sewerage industries.
The construction sector remained under pressure in the third quarter, shrinking 2.5 per cent, following a three per cent drop in the previous quarter.
Within the services sector, the index of distribution, hotels and restaurants rose 1.6 per cent, transport sector grew 0.8 per cent, business services and finance increased one per cent and government services lifted 1.6 per cent.
Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, said the one per cent rise was good news for confidence but did not change the overall economic picture.
She said: "We have been saying for some time now that it is not all doom and gloom in the economy, but there are clearly major issues that need to be resolved.
"It doesn’t mean the necessary rebalancing of the economy, to provide the foundation for sustained growth, is complete.
"We know we need to get more companies exporting if we are going to see strong growth in years to come.
"We also need to get more people starting their own businesses.
"This is positive news, which builds on a range of other positive economic measures recently, but we certainly cannot become content that the hard work has been done."