Business confidence across the United Kingdom remains mired near its lowest recorded levels following the Chancellor's recent Budget, which failed to deliver a meaningful boost to economic growth, a major new survey of business leaders has revealed.
Sharp Decline in Business Optimism
The poll conducted for the Institute of Directors (IoD) uncovered a deeply pessimistic outlook among company bosses. It found that plans for job creation have fallen sharply, while expectations for future sales and investment have plummeted to their lowest point since the height of the pandemic.
IoD chief economist Anna Leach described the deterioration in the economic expectations of business leaders as 'worrying'. She stated: 'The Budget has weakened sentiment not just about the UK economy, but about firms’ ability to grow in it.'
Budget Fails to Reverse the Trend
This slump in morale follows a difficult period for businesses, which were already contending with a £25 billion raid on employer National Insurance in the previous year's Budget.
Confidence had already plummeted in recent months, hitting a record low of minus 74 in September amid widespread speculation and uncertainty in the run-up to this year's fiscal announcement. The IoD reported a marginal improvement to minus 73 in October, followed by a further slight rise to minus 72 in a snap poll taken immediately after the Budget. However, these figures remain critically low.
Ms Leach added that with four out of five business leaders viewing the Budget negatively, it was 'no surprise that confidence remains close to record lows afterwards'. She emphasised: 'Work remains to be done to lift the UK’s growth prospects.'
Broader Economic Forecasts Worsen
Separately, a new forecast from the accountancy firm KPMG predicts that the UK's economic growth will slow from 1.4 per cent this year to just 1 per cent in 2026. This downgrade is attributed to a worsening jobs market and subdued consumer confidence.
The forecast anticipates unemployment rising to 5.2 per cent, with wage growth set to slow and household spending likely to be hit. Echoing the grim sentiment, Asda boss Allan Leighton said on Friday: 'The country is stuck in reverse.'
Further compounding the issue, a separate poll for the consultancy WPI Strategy confirmed the dire employment outlook, revealing that most bosses now plan to hire fewer staff as a direct result of the policies announced in the Budget.
