But council officials have warned that there could be job losses and service cuts if their pay demands are met. More than 5,000 workers in Hartlepool and east Durham staged a mass walk-out yesterday after hitting out over a 2.5 per cent pay rise offered by local government chiefs.

And teaching assistants, refuse collectors, social workers and rent-collectors continued strike action today.

Edwin Jeffries and Margaret Waterfield, Unison branch secretaries in the Hartlepool, were among the pickets during the two-day strike

Mr Jeffries said: "We are happy with the turnout. The action is having the desired effect locally.

"We hope that this two day strike will bring the employers back to the negotiating table.

"The 2.45 per cent offer is a straight pay cut for the fifth year running. Petrol prices are up 22 per cent, gas and electricity up 15 per cent and food bills up 11 per cent in the last year. Even the official inflation figures are now four per cent and rising."

He warned that further action may take place if employers refuse to negotiate a better deal.

Hartlepool Borough Council chiefs estimated that, despite administrative buildings being closed to the public, two thirds of employees attended work yesterday with some services unaffected.

Meanwhile a third of schools were open or partly open.

A spokesman said: "This is a national dispute and while we understand the frustrations of trade union members regarding the pay negotiations, it must be remembered that a larger settlement could result in either cuts in services or job losses. We hope fa speedy solution can be found."

Action at District of Easington council saw 400 out of 663 staff walk out.

Howard Pink, regional organiser with Unison, who covers the Easington district, said: "Wednesday went extremely well. The Easington reaction was solid."