"Companies are entering the year with optimism, but are aware of the existing risks," Michael Huether, director of the business-backed IW institute said in a statement.
The IW found that 25 of the 44 sector associations it questioned shortly before New Year said current conditions were better than a year ago, 15 said the situation was unchanged and four said it was worse.
Twenty-five federations were optimistic that 2006 would bring somewhat more production or turnover than 2005. Nine believed 2006 would be the same as 2005, with eight -- including retail, construction and skilled trades -- more pessimistic.