The service sector is romping ahead and manufacturing is holding its own according to the latest quarterly economic survey of members by The Chamber for Coventry and Warwickshire.

Even hard hit exporters managed to achieve an improvement in the second three months of the year.

The proportion of exporters reporting decreased sales fell to a balance of minus 15 per cent, down from minus 20 per cent and compared with a negative figure of 38 per cent six months ago.

"Even on jobs slightly more manufacturers had taken on extra people than had reduced numbers-and one in four expect to need more workers in the next three months," said a spokesman for the Chamber of Commerce, Training and Enterprise.

"Worryingly, however, nearly 67 per cent reported difficulty in getting people, especially skilled manual and technical workers. Yet spending on training was halved compared with the previous quarter "

The same jobs picture emerged amongst service companies, with 27 per cent of firms taking on new people and around the same number expecting to increase their workforces in the next three months.

"Interestingly, as we keep pointing out on the local front, in both manufacturing and the service sector well over 80 per cent of the jobs were full time, although only half of them were permanent," the spokesman added.

In the service sector the hardest vacancies to fill were professional and managerial, followed by clerical, with more than one in three companies reporting difficulties.

As a result, the majority have increased their training expenditure.

Despite the obstacles for manufacturers there was a plus of 23 per cent expecting to increase turnover, and a slight majority expecting to improve on profits.

But most were forecasting improved turnover only as a result of reducing prices.

In the service sector a massive balance of 58 per cent expect to increase sales compared with 39 per cent a year ago. And the majority expect to increase prices.

And the balance of those forecasting an increase in profits went up to plus 46 per cent, compared with 21 per cent a year ago.

"This is yet further proof that service sector companies in Coventry and Warwickshire are more than compensating for the downturn in manufacturing," said The Chamber spokesman.

Biggest worry for manufacturers was competition, cited as a concern by a massive 55 per cent, followed by exchange rates, at 38 per cent.

Competition was also the largest concern for service companies, cited by 44 per cent.

The survey, which questioned 170 firms, also found that one in three manufacturers are now geared up to accept payment in Euros.

On pay settlements, one in four manufacturers and one in five service companies reported being under pressure.