Confidence is high among West Midland’s manufacturers after activity in the first quarter of 2012 exceeded expectations.

As a result firms are expecting the trend to continue with increased output and orders over the next three months.

The sector is buoyant according to a survey released by EEF, the manufacturers’ association, and accountants BDO LLP.

But for the second consecutive quarter, the region’s output remained below that of the North West, though it stepped ahead of Yorkshire and Humber and the North East.

A balance of 23 per cent and 21 per cent of companies are expecting to see output and orders increase in the second quarter, indicating increased confidence from the previous quarter.

Optimism has also been reflected in job prospects, with 11 per cent of companies having taken on new employees and 17 per cent saying they have recruitment plans for the second quarter.

There was also a notable improvement in UK demand with the balance of manufacturers reporting an increase in domestic orders on a par with export orders.

Tom Lawton, Birmingham based partner and head of manufacturing at BDO LLP, said: “Manufacturers seem to be reassured by strengthening output and forward order books, and are looking forward to the next three months with more confidence.

Richard Halstead, regional director at EEF, said: “Manufacturing indicators hit a soft patch at the end of last year as events in global markets weighed on confidence and held back orders growth in some sectors.

“But our latest survey confirms this was a temporary setback rather than the beginning of a more a worrying trend for both the sector and the economy more widely.

“The confidence shown in our survey again demonstrates the resilience of manufacturing in the face of a changing global outlook.”