THE UK could be heading into a triple-dip recession after another drop in the manufacturing industry.

The country's sector contracted again during the first three months of 2013 after marked falls in production and new export orders, with the latter dropping for the 15th month running.

Last night, figures showed manufacturing activity slumped to 48.3 on the Markit/CIPS purchasing managers' index in March, well below the accepted mark of 50 which separates growth from contraction.

The British Chambers of Commerce said services firms had seen near-record levels of expert deliveries and orders during the first quarter, but manufacturers' organisation EEF said firms were suffering from a drag on orders from EU countries.

Last week, Energy Minister and Minister of State for Business, Innovation and Skills Michael Fallon, oversaw the launch of Nissan's mass market electric Leaf car at its Sunderland plant, and said the North-East's manufacturing and engineering bases were playing a key role in driving forward UK industry.

Mr Fallon, a former Darlington MP, said: “This region boasts a proud tradition of manufacturing and engineering skills and it still has some world class companies. “We must do all that we can to protect this vital sector and give it the tools to flourish.”

However, a survey from The Institution of Mechanical Engineers (IME) said the country's manufacturing industry was being stifled by the Government, who was placing too greater emphasis on the financial sector.

The survey, of 1,000 manufacturers, revealed more than half of the respondents believed only one-in-four coalition policies were helping the manufacturing sector, with 53 per cent saying the uncertainty over the UK's relationship with the European Union was damaging future production.

Philippa Oldham, IME head of manufacturing, said: “The UK manufacturing sector should be at the very heart of a thriving economy, but there is little confidence and people overwhelmingly say the Government is far too committed to the financial sector.

“It should be looking to the potential of manufacturing to spearhead economic recovery and lead the country towards growth.

“Visits to factories and warm words are not enough, the Government must set out a clear, long-term industrial strategy with cross-party support, to address the engineering skills shortage and provide greater financial incentives.”