MANUFACTURING in the county is bucking the national trend by declining at a slower rate, a new report has revealed.

However, the service sector within Worcestershire is out-performing the manufacturing industry by far and is more confident of increased profitability.

And Stephen Hodge, chairman of Wyre Forest Business Forum, warned while recent developments had brought a jobs bonanza in the service sector, the manufacturing industry was continuing to shed jobs.

Manufacturing saw a decline in the number of jobs of 3.5 per cent to 46,702 in Worcestershire compared with 6.4 per cent to 493,277 in the West Midlands and 4.2 per cent to 3,787,290 nationally.

However, more than 44 per cent of notified vacancies within the industry remained unfilled in April 2001, while more than 13 per cent of companies within the county had vacancies on site. A total of 71 per cent of manufacturing firms have difficulty in recruiting.

Manufacturing investment in Worcestershire is projected to increase by 2.6 per cent between 2000 and 2005, compared with 2.9 per cent for the West Midlands and the UK as a whole, and by 3.1 per cent between 2005 and 2010, compared with 3.4 per cent in the region and 3 per cent in the UK.

In addition, manufacturing companies in Worcestershire are currently performing worse than public sector companies - 28 per cent of manufacturing firms reported an increase in overall sales, customers or bookings against 41 per cent of the firms in the service sector. Similarly, only 30 per cent of manufacturers reported a rise in advance orders or bookings as against 42 per cent of service firms.

Mr Hodge said: "In the last month, Tesco recruited 440 people but in manufacturing, 34 jobs have gone at Master Weavers Ltd, Kidderminster and another 34 will go if the company is not sold on.

"A buy-out has been refused at UEF so you've got the potential of 200 jobs lost."

The report was considered by Worcestershire County Council economic development and regeneration panel on Monday.