CONFIDENCE in the North-East manufacturing sector has soared - outstripping nationwide expectations.

A survey of businesses in the region showed 80 per cent of manufacturers were expecting to improve turnover in the next year.

The findings of the British Chambers of Commerce Quarterly Economic Survey put manufacturing confidence from May to July 69 points up on the previous quarter.

That response was 42 points above the national aggregate.

The survey goes against Government employment figures yesterday, which painted a bleak picture in the region - showing that 7,000 more people were out of work this quarter than last.

Other indicators measured by the Chambers survey painted a picture of positive economic growth for the region.

Home sales and orders have recovered in the manufacturing sector with medium and large firms performing particularly well.

The North-East service sector has outstripped every other region in the country with much stronger home sales.

Forty four per cent of these firms reported an increase, a 22-point jump on the previous quarter and 14 per cent above the national average.

But manufacturing export sales took a hit, with 17 per cent fewer firms reporting an increase - down 21 points from the previous quarter and 29 points below the national aggregate.

The strong showing by manufacturing firms on home soil has had a good impact on employment levels in the region with 43 per cent of manufacturers expanding their workforce in the past three months.