Business activity across English regions grew at its strongest pace for more than a decade in August, figures showed.
The reading of 61.0, up from 60.0 in July, was the best performance since the Lloyds regional purchasing managers' index began in January 2001 - where a level of 50 separates growth from contraction.
The North West saw the strongest rate of expansion with a reading of 64.0, followed by the South East (62.7), as all the regions grew. The slowest rise was in the North East at 56.3, followed by Yorkshire at 57.3.
Private sector companies across all regions took on staff with the strongest rate of job creation in the West Midlands. But they also all saw increased cost burdens, attributed to higher energy bills as well as wages.
The overall reading means the index has posted a score of above 50 for 10 consecutive months.
Meanwhile in Wales, business activity growth rose marginally from 57.6 to 57.7.
Firms said higher consumer demand as well as greater investment spending in both public and private sectors had boosted business.
David Oldfield, managing director, small and medium enterprise and mid markets banking for Lloyds Banking Group, said businesses in England and Wales had taken "another step forward on the path to recovery".
"The strong growth seen in all the English regions is another sign that the country is returning to growth, as the combined rate of output expansion during August was the strongest for over a decade.
"Wales has also witnessed strong improvements this summer, with business activity increasing at the strongest rate for around four years.
"The most encouraging aspect of the recent increase in business activity is that it has fuelled job creation across the private sector.
"We have seen employment growth across England and Wales this summer and all the signs are that we should expect more of this good news over the coming months."
A separate survey from accountancy and business advisory firm BDO found short-term UK business prospects in August at their highest level since March 2011 while optimism among firms reached its strongest since May 2011.
However, the figures showed a less rosy picture on the jobs front, with hiring intentions unchanged from July and only rising slowly in the last five months.
Peter Hemington, partner at BDO, said that with productivity at a low level, it may be that the pick-up in business activity is absorbed by higher levels of output per worker.