Quarterly Economic Survey Report Q1 2026

We are proud to have sponsored the Q1 2026 Quarterly Economic Survey Report (QES) the UK's longest running and largest business sentiment survey, recently published by the Thames Valley Chamber of Commerce (TVCC). This latest edition follows the release of the national results by the British Chambers of Commerce (BCC), providing timely and vital insights into the economic landscape as businesses navigate weakening demand and escalating costs.

The Q1 2026 Quarterly Economic Survey (QES) report, conducted between 9 February and 9 March 2026, reflects responses from a broad cross-section of businesses across the Thames Valley.

The survey captures trends across key indicators including sales, employment, cash flow, investment, capacity utilisation and price pressures, and provides an early indication of changing economic conditions. Overall, the Q1 2026 report suggests businesses are holding their ground, adapting to difficult conditions, rather than experiencing renewed momentum. A sustained improvement in confidence is likely to depend on easing cost pressures and a more meaningful recovery in demand as the year progresses.

Key findings include:

• UK sales and orders show modest improvement, with 40% of businesses reporting increased UK sales and 36% reporting increased UK orders, although demand remains mixed overall.
• Employment trends remain relatively steady, with 28% of firms increasing their workforce over the past three months, and 36% expecting workforce growth in the months ahead, while the majority anticipate headcount remaining broadly unchanged.
• Recruitment difficulties persist, with 60% of businesses reporting challenges in finding suitable staff, particularly in skilled manual, technical and managerial roles, continuing to act as a constraint on growth.
• Capacity utilisation remains below potential, with 51% of firms currently operating below full capacity, highlighting ongoing slack in the economy.
• Cash flow and investment remain cautious, with most firms reporting stable rather than improving positions, and many delaying major capital investment decisions due to uncertainty.
• Cost pressures continue to squeeze margins, with labour costs cited as the most significant driver of price rises, followed by utilities, other overheads, and finance costs.

Darren O’Connor, Partner at James Cowper Kreston, commented: “The overall message is one of cautious stabilisation, but with confidence still quite fragile. Demand remains mixed, cost pressures continue to dominate, employment intentions remain relatively positive on paper, and investment remains cautious. So overall, Q1 shows resilience rather than momentum - businesses are adapting and holding their ground, but a sustained recovery will depend on easing cost pressures and a genuine improvement in demand as we move through 2026.”

Paul Britton, CEO of Thames Valley Chamber of Commerce, said: “It is clear that businesses across the Thames Valley continue to demonstrate resilience in the face of ongoing economic pressures. Encouragingly, many firms report increases in UK sales and orders, reflecting a degree of underlying strength in domestic demand. However, this optimism is tempered by persistent challenges. A significant proportion of businesses continue to operate below full capacity, while recruitment difficulties, particularly for skilled roles, remain a key constraint on growth. At the same time, cost pressures, especially from utilities, labour, and raw materials, continue to weigh heavily on business confidence.”

Thank you to all the businesses who contributed to this survey - your insights are invaluable in shaping the economic future of our region. Click here to download the QES Q1 2026 report in full.