Manufacturing firms have been recruiting new staff and investing in their business as they end the year by "powering ahead", according to a new report.
The Engineering Employers Federation (EEF) said a survey of over 500 manufacturers showed that trading conditions were strong, boosted by "robust demand" from overseas markets.
The EEF forecast that engineering and manufacturing will outperform the rest of the UK economy next year.
Chief economist Ms Lee Hopley said: "Manufacturers are ending the year on a high and should enter 2011 on a strong footing. The survey has shown record responses on output and orders for much of this year and, if this continues, we should see exports and investment delivering better balanced growth across the economy.
"However, the backdrop to an ongoing recovery through 2011 remains an uncertain one. A number of risks remain firmly on companies' radar, including the potential for the upturn to lose momentum in the UK's major markets.
"The strong bounce back has also brought challenges, with some manufacturers struggling to get the skills they need and facing rising costs."
Tom Lawton, of public accounting firm BDO LLP, which helped with today's report, added: "This broad-based recovery shows that manufacturing can be the flag bearer for the vital private sector growth we need as impending cuts mean the public sector must take a back seat.
"Manufacturers now need to take advantage of this continued growth by investing in capital equipment and the skills within their workforce. They should also take the opportunity provided by the UK's competitive currency to grow market share overseas both in the Eurozone and emerging markets."
The CBI said in a separate report that manufacturing should be at the forefront of the UK's economic development.
Director general designate John Cridland said: "UK manufacturing is in many ways the unsung hero of our economy. Big productivity gains in the past 10 years have made it leaner than ever before, and it's now well-placed to lead the country's economic recovery.
"To achieve this, however, the government must act fast. It should build on the sector's strengths, work with business to harness its innovation, and create a tax and regulatory environment that helps UK manufacturers drive up growth in productivity and exports.
"We want the government to be ambitious: focus its support on the sectors with most export growth potential, and improve the UK's competitiveness as a place to invest."
Since 1997, productivity in UK manufacturing has increased by 50 per cent, about double the growth in productivity for the economy as a whole.