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The North East economy moved out of contraction for the first time in almost a year last month - though only just, a new survey suggests.

The latest PMI survey data from NatWest and IHS Markit showed a slight rise in private sector activity in February, with a score of 50.1 recorded, just above the 50.0 threshold that separates growth from contraction.

That was an improvement on the reading of 48.2 in January and ended a sequence of continuous contraction stretching back to May last year.

But the region is still struggling when compared to most of the rest of the º£½ÇÊÓƵ, which saw a reading of 53.0 in February. The only area to see a worse performance than the North East was Northern Ireland, where activity posted another marked contraction.

Richard Topliss, chair of the NatWest North regional board, said: “After a difficult period for the North East private sector, it was encouraging to see some green shoots starting to appear across the PMI data in February, with business activity up for the first time in 10 months, the decline in employment easing and local firms growing in confidence about the outlook.

“However, it’s important to consider that most of the field work for February’s survey was completed before the escalation of the coronavirus in Europe.

“The potential disruption to activity from virus containment efforts threatens to stop the North East’s recovery in its tracks, with the survey already revealing an impact on some of the region’s major export markets.”

February saw inflows of new business across the North East private sector fall only marginally, with the rate of decline little-changed from previous survey period and noticeably slower than those seen in the final months of 2019.

Local manufacturers recorded a return to growth of new orders, though this was offset by ongoing weakness in demand across the region’s services economy.

The survey continued to point to a lack of pressure on business capacity across the region. Backlogs of work fell during February, and at a quicker pace than that recorded at the start of the year. Companies maintained a preference for lower workforce numbers, with private sector employment falling for the 20th month in a row.

The most recent unemployment figures showed that the North East remained by far the worst area in the º£½ÇÊÓƵ for joblessness, with an unemployment rate of 6.1% compared to the national average of 3.8%.