by business editor Trevor Sturgess

The first-ever Manufacturing Week began today on an upbeat note as Kent and south east firms reported their strongest performance in two years.

The Manufacturing Outlook survey, published by EEF, the manufacturers' organisation, and accounting firm BDO, showed a rise in the number of companies with growing output and new orders.

Electronics did particularly well in the south east, whilst motor vehicles, helped by the cash-for-bangers scrappage scheme, also enjoyed a boost.

The survey found that firms had scaled back on job cuts. One in seven reported rising staff numbers over the past quarter, with a similar proportion planning to recruit over the coming three months. But many firms reported a reduction in investment plans.

The survey found a positive 23 per cent balance between companies reporting increased output and those reporting lower figures; a seven per cent increase in the number of manufacturers reporting improved total new orders; and great optimism about the future, with 47 per cent expecting better output in the next three months, the highest rating since early 2008.

David Seall, EEF south east region director, said: "Overall, this is the most positive EEF quarterly survey for manufacturers in the region for over two years."

But the sector had to be cautious. A number of factors could knock growth off track. "The recovery depends on world markets continuing to grow, and the financial system’s ability to provide finance is yet to be fully tested.

"Investment plans are also likely to remain on hold until manufacturers get a better sense of how a new government plans to repair the public finances."

Mr Seall explained why the sector was holding a special week of events.

"This week will provide the perfect opportunity to explain to politicians and the wider public why manufacturing, as part of a balanced economy, is so important to our future.

"As a nation, our over-reliance on financial services has been exposed, and so the challenge for the next government - whatever the colour - will be to think and act differently. It’s a huge task but we have to start now."

Manufacturing in the south east is estimated to be worth around £18billion to the regional economy and employs some 320,000 people.