Sales within the UK and overseas are up 4% but more firms in the region say finding suitable staff is a challenge, up from six to seven out of ten, while 3% more are considering raising their prices – East Midlands Chamber’s first Quarterly Economic Survey of 2026 reveals ‘more caution than confidence’.
Hundreds of East Midlands businesses, across a wide range of sectors, participated in the Chamber research, which is delivered in partnership with the University of Leicester. The data gathered in the survey is based on a combination of measurable data and sentiment.
Sales and orders performance stabilised slightly over the last 3 months
UK – compared to Q4, 2025
- Sales up 4%
- Orders down 1%
Overseas – compared to Q4, 2025
- Sales up 4%
- Orders up 16%
Pressure to raise prices over the next three months remains
4 out of 10 firms (43%) anticipate raising their prices
up 3% from Q4 2025 and up 12% from Q3
Majority of firms continue to operate below capacity
7 out of 10 businesses (73%)
no change from Q4, 2025
Investment intention in machinery and training has risen slightly
2 out of 10 (16%) have revised machinery investment intention upwards
3% increase from Q4 2025
2 out of 10 (16%) have revised training investment intention upwards
2% increase from Q4 2025
Challenge of finding suitable staff increases slightly
7 out of 10 businesses (67%) reported difficulties in finding suitable staff
up from 6 out of 10 (59%) in Q4 2025
Fall in businesses having tried to recruit staff
Fewer businesses (45%) attempted to hire new staff
down 3% from Q4 2025
More businesses consider increasing their workforce
2 out of 10 businesses (20%) expect to increase their workforce in the next 3 months
6% net increase from Q4 2025
Confidence in profitability and turnover for the next 12 months show slight improvement
4 out of 10 (36%) businesses expect profitability to improve
3% net increase from Q4 2025
Half of businesses (47%) expect turnover to improve
2% net increase from Q4 2025
Competition overtakes Business Rates in Top 3 concerns of East Midlands firms, ranked in order
- Inflation (no change from Q4, 2025)
- Corporate Taxation (no change from Q4, 2025)
- Competition (Business Rates were in third position in Q4, 2025)
East Midlands ChamberDirector of Policy and Insight Richard Blackmore said: “Operating with more caution than confidence is the general approach East Midlands businesses seem to have taken across this quarter to mitigate against high costs before looking at investing to grow.
“Lifts in UK and overseas sales are strong performance indicators, suggesting slightly more stable trading than we saw throughout 2025 but with more firms reporting pressure to increase their prices and less than half having attempted to hire staff, being mindful of costs would seem to remain front of centre of thinking.
“Inflation, still above the Bank of England’s 2% target, continues to top concerns reported by firms, along with corporate taxation so when you factor in the lift of 3% in businesses considering raising their prices and couple that with hesitant hiring in recent months, the sense of mitigating against cost is clearer.
“With many firms likely to have reduced their cost base where they could, any increased investment intention in machinery, up 3% from the last quarter and training, up 2% from the last quarter may mean businesses have already made difficult decisions and are now thinking more about growth.
“On recruitment, while there has been a 6% net lift in businesses intending to increase their workforce, we’re only talking about two out ten businesses. Finding suitable candidates to fill roles is a persistent problem. Across 2025, six out of ten businesses reported difficulty finding the right staff but for this figure to have crept up to seven out of ten underlines the urgent need for skills investment, as proposed in the Chamber’s Framework for Growth.
“Increases of 3% in confidence of profitability and 2% in turnover confidence for the next 12 months are encouraging but as we approach a new financial year, a layer of uncertainty could cloud the outlook for the months ahead. Any economic impact from the Middle East conflict may not have been fully seen yet, while from April businesses will be adjusting to the first stages of the Employment Rights Act coming into force, adding to challenges already faced by business.”
View East Midlands Chamber’s Quarterly Economic Survey findings for Q1 2026 here.
View East Midlands Chamber’s Framework for Growth in full here.
