FIGURES produced by Darlington businesses for May are in complete contrast to the previous four weeks.

Whereas in April, turnover and employee levels had increased and business confidence had fallen, in May the indices for turnover and employees were down and business confidence was marginally up.

Tony Luckett, a partner at Clive Owen & Co Chartered Accountants, said: "It is particularly disappointing to see the fall in employees, with recent trends being largely positive.

"The Business Index figure, however, tallies with figures produced by the Office of National Statistics that show that over the past three months the number of unemployed in our region rose by 3,000 to 68,000.

"This is the highest unemployment rate outside London. Nationally, the number of jobs in manufacturing reached a record low of 3.2m, after a fall of 79,000 in the last quarter.

"This presents a worrying picture for the region, whose major employers were, only last month, saying they were struggling to recruit skilled workers.

"On a more positive note, the town's Firthmoor into Work project, funded by regional development agency One NorthEast, has been a success.

"With an original objective of helping 20 people into work each year for three years, it has surpassed expectations by assisting 200 of Firthmoor's residents secure jobs."

The slight fall in turnover experienced by Darlington businesses in May is typical of regional businesses, especially in retail.

The department store group, House of Fraser, which incorporates Binns, in Darlington, has experienced slow sales of big ticket items in its home division.

Economic commentators at HSBC Bank recently confirmed the struggling retail sector is no longer the key sector in UK growth, and with industrial and export sectors remaining weak, business confidence is set to suffer in the long-term with large companies saving rather than spending.

Mr Luckett said: "Despite the gloomy outlook painted by the drop in turnover and employees, business confidence has seen a small upturn.

"This encouraging view is reinforced by news that local construction firm MMP has won a £2m contract to convert a former girls' school into luxury flats in the town."

The Newton Aycliffe-based group has been appointed by Darlington Homes, a subsidiary of Darlington Building Society, to transform the former Claremont School for Young Ladies in Darlington into 21 flats.