THE economic recovery is still on the right track, although its pace is slower than desired is the conclusion of Herefordshire and Worcestershire Chamber of Commerce following the results of its latest Quarterly Economic Survey (QES).

The QES for Q2, completed by more than 300 local businesses, showed positive local trends in both domestic and overseas markets.

Domestic sales and orders have shown an overall improvement for both manufacturing and services firms, while overseas sales and orders have also risen compared to Q1, bucking the national trend, which showed a fall in export figures.

One of the main concerns coming from the business survey was the fact that the number of firms experiencing difficulties recruiting staff doubled from Q1, evidencing a problem with recruitment and skills, which are issues the Chamber has long campaigned about. A slight fall in the investment balance was also "disappointing".

Overall, however, the results remained encouraging and local firms are also confident about the future economic prospects of the two counties, with both the turnover and profitability balances improving. Turnover confidence increased seven per cent from Q1 (from 70% to 77%), while confidence regarding profitability also increased, by two per cent.

Mike Ashton, Herefordshire and Worcestershire Chamber of Commerce's chief executive, said: "The two counties' businesses are driving economic recovery and this is shown by the QES for Q2. Difficulties with recruitment and a drop in investment are disappointing but the overall picture remains positive."

The Quarterly Economic Survey (QES) conducted by the Chamber of Commerce is the largest and most representative independent business survey of its kind, with around 8,000 responses from businesses in the UK each quarter.

The survey looks at a range of issues, including home sales and orders, export sales and orders, employment prospects, investment, recruitment difficulties, cash flow and price pressures.

Herefordshire and Worcestershire Chamber of Commerce is ranked ninth out of 53 Chambers in the country for number of respondents to the QES in the first quarter of 2014. Greater numbers of respondents to the survey are said to mean more representative results and greater business influence as results are fed into central government.