America’s midsize business leaders have hit the dimmer switch on their economic enthusiasm. A fresh JPMorgan Chase survey reveals that only 39% feel optimistic about the national economy in 2026—a steep slide from 65% a year ago, when sentiment hit a five-year peak.
This tempered outlook could ripple through the broader economy, given that these middle-market firms—those with $20 million to $500 million in revenue—power about a third of private-sector jobs and output. Yet, the shift hasn’t sparked panic; instead, it’s nudging leaders toward smarter, more defensive growth plays.
With geopolitical jitters front and center, companies appear to be channeling energy inward, boosting interest in mergers and acquisitions as a safer bet than betting big on global calm.
Melissa Smith, head of commercial banking at JPMorgan Chase, dubbed the mood “cautious optimism.” She noted in an interview that executives still feel solid about core economic fundamentals, but ongoing global uncertainties are clearly cramping their style.
Over 1,400 leaders weighed in on the survey. Confidence in their own companies remains robust at 71%, barely budging from last year’s 74%. Industry-wide optimism dipped slightly to 51% from 60%. Expectations for revenue growth held steady, with 73% anticipating increases—just a tick down from 74%.
Profit projections landed at 64%, versus 65% previously. Hiring plans softened a touch, with 48% eyeing workforce expansion compared to 51%. These midsize firms pack a punch as an economic bellwether. They attract steady banking business and fuel private equity pipelines.
As national optimism cooled, appetite for M&A as a growth tool jumped to 39% from 31%. Bankers are eyeing a rebound in smaller deals after last year’s megadeal frenzy. Smith highlighted how leaders are getting creative with partnerships.
Credit worries flared late last year, amplified by the Tricolor auto lender collapse that dinged JPMorgan with a $170 million exposure. Banks have mostly shrugged off broader fallout so far. Smith pointed out that most companies boast healthy balance sheets heading into the new year.
Modest hiring intentions suggest many could become appealing acquisition targets. No massive credit deterioration in sight, she added. Geopolitical fog aside, executives seem poised to navigate rather than hibernate.
Their own backyards look greener than the national landscape. Deal appetites are perking up accordingly. Cautious, yes—but hardly frozen.
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