European businesses expect better sales in 2027 but confidence is another matter

Europe’s businesses are expecting to sell more in 2027, both at home and abroad. That should be good news. The trouble is, they are far less convinced about what comes next, with confidence weakening, investment still struggling and employers reluctant to take on more staff. That rather uncomfortable contradiction emerged in Dublin on Tuesday, where Eurochambres CEO Ben Butters presented the Eurochambres Economic Survey 2027 during the SME and Clusters Assembly 2026. The findings, unveiled during the ‘Competitive Enterprise’ panel, draw on the views of more than 40,000 entrepreneurs across 27 European countries, offering a revealing picture of a business community that continues to trade despite growing doubts about the economic environment. According to the latest survey, expectations for both domestic and export sales have moved into positive territory for the first time in recent editions, with both exceeding their ten-year averages. It is an encouraging development for European companies, particularly after several years of economic disruption, rising operating costs and uncertainty over international trade. Domestic sales are expected to benefit from stronger demand, while export expectations have also improved, pointing to renewed opportunities for businesses selling beyond their national markets. But the optimism appears to stop at the order book. Indeed, employment expectations remain negative for the fourth consecutive year, reflecting the continuing pressure of labour costs and difficulties finding workers with the right skills. Investment presents a similarly mixed picture. Although expectations have improved compared with the previous two years, they remain below their historical average, suggesting that companies are still holding back on spending, despite the prospect of better trading conditions. Perhaps the most telling finding concerns business confidence itself. Rather than improving alongside expectations for sales, confidence is expected to weaken slightly in 2027, falling below its ten-year average. The explanation lies partly in the problems companies expect to face over the coming year. Energy costs and access to affordable raw materials remain among the biggest concerns, alongside the cost and complexity of complying with regulations and administrative requirements. The uncertainty is compounded by volatile energy prices, geopolitical instability and an unpredictable regulatory environment, all of which continue to make business planning difficult. Labour costs are another significant pressure, particularly for smaller businesses with limited room to absorb additional expenses. These are not temporary inconveniences. They are problems that affect companies’ ability to compete, set prices, recruit staff and invest in future growth. The findings also have particular relevance for Cyprus, where energy costs, administrative requirements and labour pressures continue to feature in discussions about business competitiveness. For Cypriot companies operating in European markets, stronger demand abroad would be welcome, particularly for exporters and businesses providing services internationally. Cyprus is already reviewing its strategy for attracting and retaining businesses and investment, with energy costs and bureaucracy among the difficulties that investors continue to face. Addressing those long-standing problems, according to the survey, will be essential if Europe’s current resilience is to develop into sustainable, broad-based growth. The survey was presented at the Dublin assembly, which brings together European policymakers, entrepreneurs, investors and business organisations to examine how companies can become more competitive.