Fire and Rescue NSW confirmed that 12 crews had been sent to Parker Street after a workshop in the Lovells Springs complex was engulfed in flames.

Employees at the scene told the Newcastle Herald the fire started on the powder coating line of the manufacturing facility at around 5.20pm.

This was confirmed by police, who said 17 workers were evacuated from the premises, which is in the industrial part of Carrington.

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"I'm not treating it as suspicious at this stage" Newcastle City Police Chief Inspector Rod Peet said.

"It is a matter that will be referred to the coroner for investigation. There is some pretty highly technical machinery in there which involves extreme temperatures for powder coating."

Firefighters said the building contained a tonne of powered paint as well as wooden pallets and cardboard boxes.

Crews donned breathing apparatus and formed a perimeter to battle the fire.

The blaze was contained to a single workshop in the facility, causing "significant damage" to one end of the structure and a piece of machinery police said was valued at more than $400,000.

The fire was extinguished by emergency services before 7pm.

"The value of this fire is in the hundreds of thousand of dollars," Inspector Peet said.

The site's leading hand, a 49-year-old man from the Mayfield area, was taken to hospital with minor smoke inhalation having attempted to put the fire out with an extinguisher.

Inspector Peet said the initial fire was contained by Lovell employees, allowing staff to evacuate the premises, before it escalated due to the combustible nature of the powder coating material.

"We will continue our presence here along with the fire brigade in regard to the finalisation of the fire and rendering it safe," Inspector Peet said.

"In the morning investigators will come on board to inspect the scene, do an analysis and work out what the actual cause of that fire was."

"First trucks have just arrived - building is totally involved in fire," the emergency service said in a statement.

About 6.20pm, Fire and Rescue NSW said via Twitter that hazardous material experts were also in attendance at the scene of the blaze.

It said firefighters were working hard to stop the fire spreading to other parts of the building.

At around 7pm police said there was no indication of any hazardous material being involved in the blaze, but they would "continue to assume something hazardous was involved" until they could definitively rule it out.

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