Strong export order books are buoying up manufacturing businesses in the Black Country, but service sector companies are less optimistic, a new report has revealed.
Manufacturing companies surveyed for the Black Country Chamber of Commerce's Black Country Business Report have a more optimistic view of the business environment this quarter, particularly for turnover thanks to exports to rapidly growing economies such as India.
But manufacturers are slightly more pessimistic on profits and also cashflow, which has been impacted by the current turmoil on financial markets.
Employment in the sector is looking positive, with 12 per cent reporting an increase in the last three months, up from seven per cent in the fourth quarter of 2007.
Twenty-seven per cent said they expect to increase employee numbers in the next three months.
UK orders have shown steady improvements, bucking the decline of the previous quarter and overseas orders have also seen a major improvement on results reported last quarter.
In contrast to the positive mood amongst Black Country manufacturers, confidence amongst service sector companies has declined, but there is still an overall positive level of confidence.
Thirty-one per cent of service sector companies expect an increase in turnover compared to 40 per cent during the previous quarter.
Employment in the sector is slowing, with three per cent of respondents reporting an increase in people employed compared to nine per cent the previous quarter.