The latest Business Leaders Survey from the Federal Reserve Bank of New York reveals a shift in sentiment among service sector firms in early October 2026. For the first time since December 2025, executives in the region expressed pessimism about the business outlook. The survey’s index for future business activity dropped 10 points to, 5.1, indicating expectations of a slight decline in business activity over the next six months.
Richard Deitz, an economic research advisor at the New York Fed, noted that business activity in the New York-Northern New Jersey region’s service sector declined significantly in October. Employment remained flat, while price increases continued to be widespread. The survey, conducted between October 2 and October 9, included responses from 150 executives across various service sector industries.
The headline business activity index fell 12 points to, 20.7, its lowest level since March. The employment index rose 5 points to 0, suggesting stable employment levels. The prices paid index stayed near 70.0, indicating sharp increases in input prices, while the prices received index rose 3 points to 36.3, its highest level in four years.
Other recent surveys also reflect declining optimism. The National Federation of Independent Business reported a dip in small business optimism in September, citing concerns about labor quality and availability. Meanwhile, The Conference Board found that CEO confidence declined in the fourth quarter, with executives expressing moderately negative views of current and expected economic conditions.