The spurt in manufacturing growth stalled in the last quarter after a strong upturn in the previous six months.

But CBI figures show an overall impovement continues across the regions, including the South East and Essex.

Key indicators like business and export optimism, capacity utilised, the volume of new orders and output improved in most regions.

In the eastern region "modest" improvements in output are expected in the coming months.

According to the CBI, employment growth will continue but at a much less rapid rate, with a further 14,000 jobs lost to manufacturing in the current quarter - half the rate of last year.

Doug Godden, the CBI's head of economic analysis, said: "The regional pattern supports the view that this is not the beginning of a reversal in the sector's fortunes. Nevertheless, challenges lie ahead, in particular the strength of sterling and rising raw material costs."

Essex Chambers of Commerce confirmed "no change" to the situation in manufacturing.

A spokesman said: "Feedback from our members suggests that things are about the same as they were three months and even six months ago, and ticking along reasonably well."

But he added: "Manufacturing does not represent a significant part of the Essex economy any more.

"Luckily, we are flexible enough for new businesses to spring up to replace those we lose and that tends to sustain a level of economic stability."

Published Friday August 20, 2004

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