Business News Round Up (06/01/2026)
IoD: Confidence improves in December, but hiring and investment remain under pressure
The IoD Directors’ Economic Confidence Index, which measures business leader optimism in prospects for the UK economy, ticked up to -66 in December 2025 from the (pre-Budget) November level of -73. Once business leaders had a little more time to reflect on the impact of last year’s Budget on confidence in their own organisations, it was little changed in December 2025, at -4, from -5 in November. Most underlying economic measures were either stable or worsened in December compared with directly before the November Budget – with the exception of those for costs: Headcount expectations dropped to -14 in December from -8 in November; Investment intentions dropped to -21 from -17; Cost expectations fell marginally to +84 from +86; Export expectations were little changed at +5 from +6; Revenue expectations were little changed at +8 from +7.
Major UK businesses grow slightly more optimistic post-budget
British company executives became a little more optimistic following finance minister Rachel Reeves’ budget and grew more willing to increase investment, although the mood overall stayed muted, a survey showed on Tuesday. The quarterly net balance of business optimism from accountants Deloitte improved to -13% in the fourth quarter of 2025 from -24% in the third quarter, while remaining below average. “Business sentiment is subdued but more positive than a year ago,” Deloitte chief economist Ian Stewart. Reeves announced 26 billion pounds ($35 billion) of tax hikes in November but delayed most of them and the increases were much less focused on businesses than in her first budget in 2024. The Deloitte survey of 55 chief financial officers at major companies was conducted between December 2 and December 14.
Scottish businesses set sights on team training to drive growth in 2026
Scottish businesses are making upskilling their focus for 2026, according to new research from Bank of Scotland’s Business Barometer. In the year ahead, nearly half (46%) of Scottish businesses will be focussing on upskilling colleagues. Another 44% will be looking to enhance their use of technology, while more than a third (37%) will be looking to improve their productivity. Reflecting their priority areas, upskilling staff (42%) is the area where Scottish businesses say they’d most value extra support to achieve their 2026 goals, along with technology enhancements (30%). Just over a quarter (27%) would also value help improving their environmental sustainability. The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.
Rising costs, climate risks leave UK SMEs exposed – reports
New, separate research has highlighted that UK SMEs are facing a dual threat — underinsurance and unassessed climate-related risks. According to Premium Credit, around one in four SMEs (24%) have been underinsured over the past 12 months, while 35% have reduced their coverage during the same period, with some cancelling policies altogether. More than half (56%) report higher insurance costs since their last renewal, reflecting the financial pressures on small businesses. Despite these challenges, a quarter of SMEs are now planning to increase coverage. Employers’ liability cover is the most commonly planned increase, followed by property, vehicle and cyber insurance. Jon Howells, chief commercial officer at Premium Credit, stressed that brokers can play a vital role by guiding clients through coverage reviews, identifying gaps and offering solutions that balance affordability with adequate protection.