Managers in the Midlands believe 2007 will be a successful year for business despite fears of rising costs, according to a new survey from the Chartered Management Institute.

Looking at the likely economic performance of the UK, managers in the region are predicting that employment will remain at current levels, with 48 per cent suggesting there will be ‘no significant change’.

However, across the UK, respondents in Wales expressed the most confidence that new jobs will be created, with 35 per cent indicating the belief that job opportunities will increase during the next 12 months. Twenty seven per cent of those in the Midlands shared this view.

The proportion of managers who believe that UK output (GDP) will increase has also risen since this time last year.

In December 2005, only 16 per cent thought UK productivity would improve, compared to 24 per cent this year. The figure for the Midlands is 23 per cent.

Across a range of industries in the UK, respondents in the IT and retail sectors are most confident, with 33 and 27 per cent, respectively, expecting improved levels of performance and productivity in 2007. However, the survey also revealed concerns over rising business costs, with nearly half the respondents in the Midlands (49 per cent) predicting further increases in business taxation.

The region’s managers also fear increasing inflation and interest rates. When the question was asked, 73 per cent suggested inflation would rise. More than eight in ten (85 per cent) also believe rising interest rates will affect business performance.

Respondents in the region were also asked about personal predictions for the year ahead and many sounded warnings for their employer.

Thirteen per cent said they planned to change jobs in the next 12 months – more than the national labour turnover figure for 2006 (12 per cent) reported in the institute's recent National Management Salary Survey.

However, the institute said that in view of the Leitch Review on Skills – which recognised a skills shortage across all areas of the UK – it was encouraging to note that 39 per cent of respondents in the Midlands intend to undertake training courses and further education during the New Year.

Recognising the need for greater international collaboration, ten per cent also stated their intention to learn a new language.

Jo Causon, director, marketing and corporate affairs at the Chartered Management Institute, said: "In the run up to Christmas many organisations, rightly, focus their attention on the achievements of the previous 12 months, but when the past year has been one littered with concerns about skills shortages and the knock-on impact on UK performance and productivity, it is encouraging to see such high levels of confidence about the year ahead.

"Of course, there are clear warning signs to employers that their staff do not want to sit still and is vital that this message is understood if UK organisations are to recruit, retain and benefit from the best talent available."