CEO Confidence Sees Notable Increase in First Quarter of 2026

The latest findings from The Conference Board indicate a significant rebound in CEO confidence, with the Measure of CEO Confidence™ soaring to a reading of 59 in the first quarter of 2026. This is an impressive jump of 11 points from the previous quarter, which recorded a level of 48. The survey, which engaged a total of 142 CEOs between February 3 and February 16, highlights a shift in sentiment towards the economy.

Dana M Peterson, Chief Economist at The Conference Board, elaborates that this surge reflects a restoration of optimism among leaders in large corporations. She noted that CEOs now view the general economic conditions more positively compared to six months prior, marking a change where previously held pessimistic views have shifted toward moderate optimism as of February 2026. Moreover, assessments of industry conditions have similarly progressed, transitioning from cautiousness to confidence.

In conjunction with this rise in confidence, businesses have shown a firming trend in investment. Notably, over one-third of the responding CEOs are revising their capital spending plans upwards for the next 12 months, suggesting a proactive approach towards growth despite some remaining reservations regarding workforce expansion. Although the percentage of CEOs predicting employment growth has slightly dipped from the previous quarter (31% versus 32%), the number of those anticipating layoffs has also decreased. This indicates a more stable employment outlook, with a substantial portion of CEOs (41%) expecting no changes in their workforce size.

Interestingly, while CEOs reported that hiring qualified employees became easier in Q1 2026, challenges have emerged in specific skill areas. Wage growth expectations appear to be moderating, with a shift in focus from higher percentage increases to more conservative growth rates. The share of CEOs expecting significant wage increases over 5% has seen a rise, although planned overall wage growth remains subdued.

Employment Insights

Looking at the specifics of employment trends among these business leaders, the current data indicates that 31% of CEOs expect to expand their workforce, a slight decline from the previous quarter. Conversely, just 27% anticipate job cuts, a notable decrease from the previous 29%. Additionally, the anticipation for stable workforce numbers (no change) remains robust at 41%, showcasing a cautious but steady approach to hiring amid fluctuating economic conditions.

Industry Prospects and Risks

When examining future expectations, CEOs have exhibited a more favorable outlook regarding economic conditions, with 43% believing that the economy will improve over the next six months, a significant rise from 24% at the end of last year. Moreover, confidence extends to industry-specific conditions, with 51% of CEOs projecting better conditions in their sectors.

Despite these positive trends, several risks loom large on the horizon. Concerns around AI and technological advancements have emerged as leading worries for CEOs, surpassing geopolitical risks. Moreover, while perceptions related to trade tariffs and supply chains seemed to ease, new financial and economic risks have gained prominence.

Impact of Tariffs and Costs

The current climate reveals that 71% of CEOs are experiencing increased costs due to tariff adjustments, with 44% indicating intentions to transfer these costs onto consumers. In contrast, 27% have chosen to absorb rising costs, balancing consumer pressures with business sustainability.

In summary, the data compiled from this recent survey indicate a marked increase in CEO confidence and a more positive outlook for both economic and industry conditions. While caution is still warranted regarding employment habits and the ongoing challenges posed by global risks, the overall trajectory suggests a cautious return to a state of optimism within the business sector as we progress through 2026.