Ukrainian business at the start: expectations are tightening, costs are rising, room for maneuver is shrinking

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January 2026 showed the state of Ukrainian business without embellishment or optimistic illusions. The Business Activity Expectations Index fell to 41.3 points, compared with 49.2 in December 2025. A reading below 50 indicates the dominance of negative expectations, and this time businesses are saying it quite directly. At the same time, the figure is slightly higher than in January 2025 (41.0), which points not to a collapse, but to difficult adaptation amid war, energy risks and labor shortages. These sentiments were captured by a monthly survey of enterprises conducted by the National Bank of Ukraine. It is not a forecast by the regulator, but it clearly shows how businesses assess their own near-term outlook.

The main pressure is coming from several directions at once. Massive attacks on energy and logistics infrastructure, electricity shortages, rising costs for generators, fuel and maintenance of alternative power sources. Added to this is a shortage of qualified workers, which for many companies has become not a temporary issue, but a structural one. The weakest expectations are in construction. The sectoral index in January fell to 37.9 points, down from 47.6 in December 2025. Construction companies directly point to difficult weather conditions, power supply disruptions and rising production costs. As a result, businesses expect a reduction in construction volumes and new orders, and assess contractor availability more cautiously. The sector has effectively reached a point where every new project goes through an additional risk filter.

Trade changed its tone sharply after ten months of positive expectations. The index dropped to 40.0 points from 52.2 in December. Companies forecast lower turnover, reduced procurement volumes and inventories, as well as further pressure on trade margins. Here, the typical seasonal slowdown at the start of the year has been compounded by electricity shortages that directly affect stores, warehouses and logistics.

The services sector has also moved into a mode of restrained expectations. The sectoral index stands at 42.1 points, compared with 49.8 in December 2025. Businesses cite rising labor and heating costs, logistics complications, shortages of energy resources and personnel. Expectations for service volumes and new orders have worsened, indicating an overall cooling of demand.

Industry is holding at 41.7 points, down from 46.5 in December. Here, the dominant factors are physical destruction of production facilities, the high cost of their restoration, electricity shortages and labor deficits. Industrial enterprises forecast declines in production volumes and new orders, including export orders, as well as reductions in raw material and input inventories. The common denominator across all sectors is expected further increases in prices and tariffs for their own goods and services. Businesses are effectively acknowledging that they are operating under constant cost pressure and are forced to pass part of this burden on to consumers to the extent the market allows.

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The labor market is sending another worrying signal. Managers across all sectors expect reductions in total employment, most notably in industry. This does not point to mass layoffs, but to a cautious survival strategy: hiring freezes, staff optimization and redistribution of workloads among existing employees. The survey was conducted from January 5 to January 22, 2026, among 594 enterprises across different sectors of the economy. Of these, 44.1% were industrial companies, 25.3% services, 24.7% trade, and 5.9% construction. Nearly a third were large companies, with roughly equal shares of medium and small businesses. More than 34% of enterprises engage in export and import operations, making them particularly sensitive to logistics and currency risks.

The picture these figures draw is neither a collapse nor a catastrophe. It is a snapshot of a business sector operating at the edge of resilience, constantly adjusting plans to energy attacks, labor shortages and rising costs. Ukraine’s economy is entering 2026 not with faith in a rapid recovery, but with a pragmatic understanding of reality: the key task is to preserve operational capacity, retain teams, and hold on until the moment when risks become fewer than they are today.