A clearer picture has emerged of the woes facing the West Midlands manufacturers.
In spite of claims about high confidence levels in the region and a buoyant sector in other parts of the UK, manufacturers here are saying times are hard.
Evidence that the financial crisis in the region is biting was reinforced with the publication of EEF West Midlands' latest Business Trends Survey.
The survey points to a difficult last quarter for the region's manufacturers after a year of good news for the sector.
Both domestic and export orders are down on the previous quarter, and for the first time in several years the number of companies reporting a decline in domestic orders (32 per cent) was greater than the number who reported an increase (28 per cent).
Profit, cashflow and margins all took a hammering in the second quarter of the year. The survey will also add to the Bank of England's concerns about inflation as firms have said they have had to increase prices to stay in profit. Disappointingly, many are predicting further increases later in the year.
The survey suggests that the combination of higher raw material, energy, component and freight costs has clearly eaten into firms' margins and that manufacturers have been unable to pass on all of the cost rises they have suffered.
One encouraging sign is that higher inflation is not currently feeding into higher wage settlements, with companies bearing down on wage costs to offset increases in other costs and the percentage of companies reporting job losses has barely moved over the last year.
However, so far as expansion of the labour force is concerned, just 12 per cent of manufacturers in the region expect to be taking on new staff in the next quarter, which is lower than at any point since 2005. In contrast to the picture painted by West Midlands' manufacturers, the figures for the UK as a whole show firms reporting arise in domestic orders. Export orders have also remained relatively strong although there are indications of a softening, possibly due to weakening conditions in the United States.
Peter O'Grady, head of representation at EEF West Midlands, said "The results are disappointing compared to the figures we have been used to over the last year. Despite the tough times though, it is encouraging that manufacturers are responding to the squeeze on their margins from rising costs by continuing to invest in their businesses to drive up productivity.
"However, at this time of heightened un-certainty, manufacturers would like the government to send a clear message that it will ensure the UK remains an attractive place to do business."
The survey was conducted between May 1 and 21 and involved 200 firms in the region.
The results take in the full spectrum of engi-neering sectors - metals, metal products, mechanical engineering, electronics, electrical engineering, motor vehicles and other transport equipment.
Further encouragement has been offered by the number of firms winning back orders from China and other emerging markets.
The quality of goods being manufactured in these areas is often inferior and orders are returning to the West Midlands because of its reputation for quality.
One company benefiting is Castings in Brownhills. The company supplies components for several vehicle manufacturers including Toyota, whose major plant is based in Burnaston in Derbyshire.
Castings chief executive David Gawthorpe was reported as saying only this week: "We did lose work to China, and we've seen the return of some of it - even very basic castings.
"We don't undercut on prices to win the work back either."