Engineering firms in Yorkshire could be easing out of recession, according to a survey by a leading business organisation.

The survey, conducted by the Engineering Employers' Federation Yorkshire and Humberside, questioned more than 100 companies across the region. Its findings suggest a slight improvement in total orders compared with the autumn.

Other trends were less sharply negative than three months ago and over 40 per cent of firms questioned reported a better position on total new orders.

But problems remain and some doubts are also surfacing about the UK economy as a whole, with almost a quarter of the companies anticipating some worsening, although the majority - 62 per cent - foresee no change over the next three months. In all, some 79 per cent of the companies taking part are now working below capacity.

Ian Hughes, the association's director, said: "The impression emerging from the survey is that there has been some further easing of the recession, but with a rise in interest rates now a possibility, and continuing problems with the high international value of sterling, there could still be major difficulties ahead."

He added: "Companies are now feeling the effects of the recession where it hurts most - in their profitability - with around half reporting a worsening position. So it should come as no surprise that the position regarding capital investment is less optimistic than three months ago."

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.