Concerns over costs mount for business leaders

11 Mar 2025

The Institute of Directors' (IoD) Economic Confidence Index has revealed that optimism amongst business leaders fell to -64 in February from -59 in January.

According to the IoD, UK economic conditions remained the most significant concern for firms: 73% of business leaders polled said that they felt economic conditions were having a negative impact on their organisation.

83% of survey respondents expect their employer National Insurance bills to increase.

Anna Leach, Chief Economist at the IoD, said: 'Amidst downgrades to UK growth forecasts, businesses remain concerned about the health of the UK economy, as well as tax and regulatory burdens.

'Our engagement with business leaders reveals that they're increasingly worried about inflation, the cost of energy and the repercussions of policy decisions in the States.

'As businesses adjust to an evolving cocktail of costs and risks, around half are expecting to reduce employment in response to rising costs, with price increases also being considered. Meanwhile, investment intentions have dipped further as businesses expect tax increases to hit their bottom line more than previously.'