IoD press release  Revenue expectations strengthen, but confidence in the outlook remains subdued

In contrast, business leaders became significantly more optimistic about the prospects for their own organisations, with confidence rising to +10, from -5 in August.

Elsewhere in the survey:

• Revenue expectations increased to +21 from +12, but remained below the long-run average of +27
• Costs expectations fell to +79, from +83 in August – their lowest since September 2024, but remaining well above the series average (+67)
• Investment intentions were little changed, at -8 from -9 in August (long run average +5)
• Headcount expectations rose to -2, from -6 (long run average +10)
• Export intentions rose to +8 in September 2026, up from +4 last month

Anna Leach, Chief Economist at the Institute of Directors, said:

“September’s results show a growing divide between confidence in businesses’ own prospects and confidence in the wider economy. Business leaders are more confident about their own organisations, and revenue expectations have strengthened. But cost pressures remain high, squeezing margins and leaving some firms having to ‘run to stand still’. Investment and hiring intentions unsurprisingly therefore remain subdued.

“As in August, firms appear to be becoming more confident in their ability to navigate difficult conditions, rather than seeing those conditions materially improve. Exporters are benefiting from stronger demand in some overseas markets, while AI is creating new opportunities and helping firms raise productivity. At the same time, uncertainty remains high, and the conflict in the Middle East is adding to energy, transport and supply-chain costs and risks.

“The Chancellor’s conference speech recognised the high cost of doing business and reaffirmed the importance of fiscal discipline and growth. Businesses will now be looking to the Budget for delivery: greater certainty in the cost environment and concrete action to improve the economics of investing and hiring in the UK, not least by addressing high energy costs.”

The IoD Directors’ Economic Confidence Index measures the net % positive answers from members of the Institute of Directors to the question ‘How optimistic are you about the wider UK economy over the next 12 months?’ on a five-point scale from ‘very optimistic’ to ‘very pessimistic’.

Full Results

650 responses from across the UK, conducted between 11-29 September.16% ran large businesses (250+ people), 19% medium (50-249), 19% small (10-49 people), 34% micro (2-9 people) and 13% sole trader and self-employed business entities (0-1 people).

How optimistic are you about both the wider UK economy and also your organisation over the next 12 months?

Comparing the next 12 months with the last 12 months, what do you believe the outlook for your organisation will be in terms of: