The KOF Business Situation Indicator for the Swiss private sector, which is calculated from the KOF Business Tendency Surveys, rose in January for the second month in a row. Thanks to this significant improvement, business activity at the beginning of this year is much more encouraging than it was at the start of 2025. In addition, companies are more optimistic about their business expectations for the next six months than they have been previously.
The rise in the Business Situation Indicator for January is mainly driven by developments in the manufacturing sector, where business has improved significantly. However, this industry is not alone in its impressive performance: the Business Situation Indicator is increasing in the financial and insurance services, wholesale, hospitality and construction sectors as well. It is also rising in the retail sector, albeit only very modestly. Business activity in other services remains more or less stable, while it is cooling slightly in the project engineering sector. All in all, the positive trend in January is fairly broad-based across the Swiss economy.
Manufacturing industry is looking to the future with greater optimism
The business outlook for the coming six months is brightening, particularly in the manufacturing sector. In addition, firms in the retail trade, financial and insurance services, project engineering and construction are more confident than they were previously. Expectations in the hospitality industry, the wholesale trade and other services are slightly more cautious than before.
Firms are looking to recruit more staff
Given the more encouraging business outlook, companies are increasingly planning to recruit additional staff. The hospitality industry in particular is finding it increasingly difficult to attract suitable workers. However, the construction industry and the project engineering sector are complaining the most about labour shortages.
Wage expectations remain unchanged
When asked about the expected growth in gross wages at their own firms over the next twelve months, respondents to the January survey – as with the October survey – revealed an average increase of 1.3 per cent. Above-average wage rises are anticipated in hospitality, project engineering and construction. Firms' forecasts of consumer price inflation over the next twelve months have hardly changed since the last survey in October. They now expect to see an average inflation rate of 0.9 per cent (October: 1.0 per cent).
The results of the KOF Business Tendency Surveys for January 2026 are based on responses from around 4,500 firms in the manufacturing, construction and major service sectors. This equates to a response rate of around 56 per cent.