THE output of East Anglia’s manufacturing and services sectors increased slightly in September, a monthly monitor of the region’s economy has revealed.

The Lloyds TSB East of England Business Activity Index, which measures the combined performance of manufacturers and services businesses, edged upwards to 50.9 in September, from 50.3 in August.

Any figure over 50 indicates growth, although Lloyds TSB – which produces the monthly index in partnership with financial information services company Markit – warned that the recovery in the region’s economy remaiend fragile.

New business rebounded from a fall in August although, as with the overall measure of activity, the increase was slight, and firms continued to take on more staff.

Staffing levels in the region have now increased for 13 months running, according to the survey, and the increase in employment helped companies to reduce the level of outstanding business for a third consecutive month.

Manufacturing firms reduced their backlogs more quickly than those in the service sector, although the increase in new orders was centred on the service side.

On the price front, cost inflation slowed for the eighth month running, to its lowest level in a year, while output charges increased slightly during September, after falling fractionally in August. Strong competition was said to have prevented a steeper increase in charges, with output prices having risen in 24 or the last 25 months.

Steve Elsom, area director for Lloyds TSB Commercial in East Anglia, said: “Although the rebound in new orders in September is welcome news, the region’s economic recovery still appears fragile a signs of weakening business conditions, both at home and abroad, have intensified competition for new orders.

“Firms were confident enough, however, to increase employment as they have now been doing for more than a year.”