Swindon's manufacturers are being urged to hang in and not do anything rash, following disappointing figures released by the Chamber of Commerce.

James Emmett, Swindon's HSBC chief, is making this appeal to the town's captains of industry.

Figures for the year's first quarter show a drop in the number of domestic and export orders in the manufacturing sector.

But the survey has urged bosses to not do anything in haste.

Mr Emmett said: "What we are seeing at the moment is the result of a lot of recent political and economic uncertainty particularly centred around Iraq. This is not a total gloom and doom situation."

And Mr Emmett has some tips for local bosses.

He said: "While we are not working to full capacity let's put the investment in, start to strengthen our positions in the markets.

"Things are disappointing on the orders front but let's hang in there. I am sure that things will get better and I would advise businesses to keep their staff structure as it is."

Mr Emmett said many local businesses were adopting a cautious stance. "Across both the manufacturing and services sectors, there is a cautious feel. While some firms look to be positioning themselves for a recovery, others are maintaining a 'wait-and-see' approach."

On the positive side, there was a noticeable drop in the number of firms experiencing recruitment problems. Just 44 per cent reported difficulties compared with 75 per cent in the final quarter of 2002.

Meanwhile, the services sector has appeared to have held up reasonably well.

"The majority of businesses say their orders, employment and investment plans have stayed pretty much constant throughout the period," said Mr Emmett.

"There was an increase in those who reported a change in cashflow and this was split with 26 per cent reporting increased and 36 per cent reporting decreased cashflow." He said that as the situation in Iraq improved, a degree of economic certainty would return.

"The second quarter figures are due soon and we look forward to seeing the improvement."

Nigel Carter, policy adviser for Swindon Chamber of Commerce, said the report indicated we are seeing a post- war syndrome.

"I would advise businesses to keep their belts tight and keep an eye on their cash flow."