CEO Confidence Jumps in Early 2026
Corporate America is feeling better about the economy.
The latest Measure of CEO Confidence from The Conference Board, conducted in collaboration with The Business Council, shows a sharp rebound in optimism during the first quarter of 2026.
The headline number surged to 59 in Q1 2026, up 11 points from 48 in Q4 2025. Any reading above 50 indicates that more CEOs are optimistic than pessimistic.
A total of 142 CEOs participated in the survey, which was conducted from February 3 through February 16.
The takeaway is clear: after months of caution and uncertainty, business leaders are regaining confidence in both the broader economy and their own industries.
What’s Driving the Surge in Optimism?
According to Dana M Peterson, Chief Economist at The Conference Board, CEO sentiment has shifted notably in just a few months.
CEOs’ views of current economic conditions compared to six months ago turned moderately positive. Even more striking, their outlook for the next six months flipped from slight pessimism at the end of 2025 to moderate optimism in early 2026.
In simple terms, business leaders are no longer bracing for a slowdown. Instead, many now expect growth to continue or even strengthen.
Peterson also noted that CEOs’ confidence in their own industries improved further. What had been mild caution late last year has evolved into solid confidence.
Interestingly, CEOs’ assessments of current conditions within their own industries — a measure not included in the main confidence index — also moved firmly into positive territory.
Economic Conditions: From Caution to Confidence
Current Economy
The numbers show a dramatic turnaround:
- 39% of CEOs said economic conditions are better than six months ago (up from 20% in Q4 2025).
- Only 8% said conditions are worse (down sharply from 37% last quarter).
That shift represents one of the most significant mood changes in recent quarters.
Industry Conditions
Confidence is even stronger at the industry level:
- 42% said conditions in their own industry are better than six months ago (up from 29%).
- Just 14% said conditions are worse (down from 38%).
For many CEOs, what’s happening inside their own sector appears even more encouraging than the broader economic picture.
Looking Ahead: Six-Month Outlook Turns Positive
The short-term outlook has brightened considerably.
Economic Outlook
- 43% expect economic conditions to improve over the next six months (up from 24% in Q4).
- Only 13% expect the economy to worsen (down from 38%).
That marks a complete reversal from late 2025, when pessimism was more widespread.
Industry Outlook
Optimism is even stronger within CEOs’ own industries:
- 51% expect conditions in their industry to improve (up from 33%).
- 14% expect conditions to worsen (down from 28%).
More than half of CEOs now expect their own sectors to strengthen in the near term — a powerful signal for business momentum.
Investment Is Picking Up
Confidence is translating into action, especially when it comes to capital spending.
According to Roger W. Ferguson, Jr., Vice Chairman of The Business Council and Chair Emeritus of The Conference Board, businesses are beginning to loosen their purse strings.
- 35% of CEOs expect to increase capital spending in the next 12 months (up sharply from 22%).
- Only 11% expect to revise spending downward.
- 54% plan to keep spending unchanged.
More than one-third of CEOs planning to raise capital expenditures suggests that companies are preparing for expansion, upgrades, and long-term growth.
Hiring: A “Low-Hire, Low-Fire” Strategy
Despite rising optimism, CEOs are still cautious when it comes to staffing.
Ferguson described the current approach as “low-hire, low-fire.”
Here’s what the data shows:
- 31% expect to increase their workforce (slightly down from 32%).
- 27% expect to reduce headcount (down from 29%).
- 41% anticipate no change.
While hiring remains positive overall, the modest shift suggests companies are focusing more on productivity and efficiency rather than aggressive workforce expansion.
Hiring Qualified Workers
Recruiting appears somewhat easier compared to late 2025. However, 11% of CEOs reported serious hiring challenges in certain areas — up from 4% last quarter.
This indicates that while the labor market may be loosening in general, skills gaps persist in key roles.
Wage Trends: Slower Growth, With Exceptions
Wage growth expectations remain steady but slightly moderated.
Most CEOs continue to scale back wage growth projections from the 3–5% range to 1–3%. However, there has been a renewed uptick in planned increases above 5%, suggesting that companies may still be competing for top talent in specialized areas.
Overall, compensation pressures have not disappeared, but they are stabilizing.
The Top Risks Keeping CEOs Awake at Night
Even as optimism rises, CEOs are not ignoring potential threats.
1. AI and New Technology Risks
Artificial intelligence and emerging technologies are now ranked as the top business risk — narrowly surpassing geopolitical concerns.
This reflects both opportunity and anxiety. AI can drive efficiency and growth, but it also introduces competitive disruption, regulatory uncertainty, and cybersecurity vulnerabilities.
2. Geopolitical and Cyber Risks
Geopolitical instability remains a close second. Global tensions continue to pose risks to trade, supply chains, and investment flows.
Cybersecurity threats also remain a major concern, particularly as digital transformation accelerates.
3. Financial and Economic Risks on the Rise
Financial and economic risks climbed in the rankings, replacing legal and regulatory risks. This suggests that while regulatory concerns have eased somewhat, macroeconomic uncertainty still looms.
Interestingly, risks tied to trade, tariffs, and supply chains have declined compared to previous quarters.
Tariffs: Higher Costs, Shared Burden
Tariffs continue to affect business costs:
- 71% of CEOs reported higher costs due to tariff increases.
- 44% have passed or plan to pass those costs onto customers.
- 27% absorbed the costs themselves.
This indicates a split strategy. Some companies are protecting margins by raising prices, while others are choosing to absorb the impact to remain competitive.
The fact that nearly half are passing on costs suggests consumers may still feel ripple effects in certain sectors.
What This Means for the Economy
The rebound in CEO confidence signals potential strength in the months ahead.
When business leaders feel optimistic, they are more likely to:
- Invest in equipment and infrastructure
- Expand operations
- Innovate and adopt new technologies
However, the cautious approach to hiring shows that CEOs are still mindful of uncertainty. Rather than aggressive expansion, many appear to be focusing on disciplined growth.
The rise in AI-related risk awareness also highlights a shifting business landscape. Technology is no longer just an opportunity — it is a defining strategic issue.
About the Organizations Behind the Survey
Founded in 1916, The Conference Board is a non-partisan, not-for-profit think tank that provides economic insights and research to business leaders and policymakers.
The Business Council serves as a forum for CEOs of the world’s largest multinational corporations, fostering dialogue on global economic and strategic issues.
Together, their quarterly CEO Confidence survey offers a valuable window into corporate sentiment at the highest levels.
The Bottom Line
After months of caution, corporate leaders are regaining confidence.
The jump to 59 in Q1 2026 reflects a decisive shift from uncertainty to cautious optimism. Investment plans are strengthening, hiring remains steady, and industry outlooks are brightening.
Still, risks tied to AI, geopolitics, and economic volatility remind us that this recovery in sentiment comes with eyes wide open.
For now, the message from the C-suite is clear: business leaders see brighter days ahead — but they’re proceeding with discipline.
