CONDITIONS for manufacturers in the region have worsened so much since February that thousands of workers could face losing their jobs, according to a new survey by the Confederation of British Industry.

The latest CBI quarterly survey shows that confidence and export optimism in the west have suffered sharp declines.

Additionally, total new orders have fallen for the sixth survey in a row, and a further sharp fall is forecast for the next four months.

And if that were not bad enough, total output in the region has resumed its decline, although expectations for the next four months are for a marginal rise.

Employment contracted only slightly, in contrast to continued sharp falls at the national level, while expectations for the next four months are for significant job cuts.

Commenting on the results, CBI South West Director, Amanda Wilkin-son, said: "Recent events in Iraq have not helped business confidence in general and the persistently tough export markets continue to be cause for great concern for South West manufacturers.

"Investment intentions for buildings and plant and machinery in the south west are now the most severely depressed of all regions, with uncertainty about demand and inadequate returns the two major constraints on investment.

"To add to manufacturers' problems, profit margins are under increasing pressure, with costs continuing to rise.

"To make matters worse, prices of goods in both UK and export markets have fallen sharply so far this year, and south west manufacturers expect this trend to continue in the months ahead."