Construction companies in the West Midlands are anticipating strong workload and employment levels, it has been claimed.

The Royal Institution of Chartered Surveyors says businesses in the region are confident about the year ahead as a study by the organisation suggests the sector nationally is poised to benefit from an improving economic outlook.

That comes as separate figures from the Government showed new construction orders in the UK rose ten per cent in the year to November from a year earlier.

The Department of Trade and Industry said in the three months to November, orders rose 20 per cent from the same period a year earlier, and by six per cent compared with the previous three-month period.

Increases were seen in most sectors. And the RICS said a weak private house building sector had not prevented overall construction activity from growing steadily in the fourth quarter of 2005.

Following a big leap in the previous quarter, the growth in private house building proved to be slower over the quarter with only ten per cent more chartered surveyors reporting a rise than a fall in workloads, compared with 29 per cent in the previous quarter.

The RICS said the deceleration was expected following the hectic pace of expansion during the third quarter.

In addition, it said the industry had yet to feel the benefit of higher demand in the UK's housing market.

Adrian Aston, RICS West Midlands spokesman, said: "We are still seeing sustained levels of activity in many sectors of the market. However, the shortage of skilled workers continues to be an issue."

The RICS says, according to the new data, West Midlands construction companies were confident about the quarter and year ahead, anticipating strong workload and employment levels.

RICS economist David Stubbs said companies were still troubled by rising costs but the overall picture was "of an industry that has staved off any marked slowdown and is well placed to grow in line with increased business demand later in the year".

He said: "Public sector investment is set to grow rapidly and the industry should soon start to reflect the pick-up in housing market activity."

According to the DTI figures private housing orders fell 11 per cent in the three months to November from the previous three months, while public non-housing orders fell by 13 per cent. Public housing and housing association orders, however, jumped 40 per cent while infrastructure orders were up ten per cent.

Private commercial orders rose 31 per cent over the three months and private industrial orders dropped 11 per cent, the DTI said.