Firms across the private sector expect activity to fall in the
three months to December (weighted balance of -14%), according to
the CBI's latest Growth Indicator.
The latest results extend a period of negative predictions for
growth that has persisted since late 2024. Declining volumes in
distribution (-34%), business & professional (-10%) and
consumer services (-12%) are expected to drag on activity.
However, expectations generally remain less negative than earlier
this year. While manufacturing output is also expected to decline
(-6%), these mark the least pessimistic expectations since
March.
The subdued outlook comes as private sector activity fell in the
three months to September (-19%). The decline was concentrated in
the services and distribution sectors, while manufacturing output
declined only very slightly.
Alpesh Paleja, CBI Deputy Chief Economist,
said:
The outlook for growth remains subdued. The picture is mixed
across sectors, particularly with some signs of resilience and
even mild improvement in parts of manufacturing and professional
services. But these are far outweighed by challenges weighing on
conditions for all businesses. Cost pressures remain strong,
especially around energy and employment and, coupled with weak
demand, this continues to put pressure on margins, recruitment
and investment plans.
Uncertainty ahead of next month's Budget is also holding back
activity in some sectors. Against the backdrop of renewed fiscal
pressures, the Budget must draw a clear red line under any more
rises in the cost of hiring, investing and doing business.
The Chancellor must focus on easing the cumulative burden of
costs, as an entry point to spurring dynamism and activity.
Removing legacy policy costs from business' electricity bills,
exploring options to reduce employer National Insurance
Contributions, and committing to a clear path for business rates
reform would be important first steps to building business
confidence and putting the country back on a path to sustained
growth.
A balance is the weighted percentage of companies reporting an
increase minus those reporting a decrease.
Full results are in the embargoed attachment accompanying
this release.
28 SEPTEMBER 2026
Notes to Editors:
About the CBI Growth Indicator: The CBI
Growth Indicator is a composite measure of activity, based on
responsesto CBI surveys.In total, 699 firms responded between 27
August and 14 September.
It is a composite of data on output, sales and business volumes
drawn from three of the CBI's long-running qualitative UK
business surveys: the Industrial Trends Survey (ITS, covering
manufacturing); the Distributive Trades Survey (DTS, covering
retail, wholesale and motor trades); and the Service Sector
Survey (SSS, covering business, professional and consumer
services).
The Growth Indicator covers the volume of output for the ITS,
volume of sales for the DTS and volume of business for the SSS,
for the past three months and the next three months.
