McDonald Hopkins’ 2025 Business Outlook Survey reveals first negative shift in U.S. business outlook since survey began

For the past 15 years, McDonald Hopkins has conducted an annual Business Outlook Survey to gain meaningful insight into the economic and business landscape for the year ahead. By surveying hundreds of executives, managers, and business owners across our offices, our firm aims to capture a broad perspective on emerging trends, opportunities, and challenges. Participants represent a wide range of industries – including financial services, healthcare, pharmaceuticals, manufacturing, and retail – allowing McDonald Hopkins to create a snapshot of the anticipated business climate that can guide strategic decisions and planning.

While McDonald Hopkins typically conducts its annual survey at the start of the new year, this year the survey was timed to follow the first 100 days of the new presidential administration. The goal was to better assess how early executive actions, proposed tariff changes, and shifts in federal policy might shape business sentiment for the remainder of 2025.

Since launching the survey in 2011, this is the first time McDonald Hopkins has seen a majority of respondents express a negative outlook on U.S. business conditions. Notably, this shift in sentiment comes despite previous challenges such as major election years and the COVID-19 pandemic.

When asked about overall U.S. business conditions for the remainder of 2025, 47% of respondents said they expect business conditions to decline, with 20% expecting things to decline significantly and 27% expecting a slight decline. Thirty-two percent expect improvement in U.S. business conditions, and 21% expect things to stay the same.

Given the current economic and political climate, it is no surprise that 45% of respondents said their outlook on U.S. business conditions has worsened since the start of the year – reflecting growing concern about what lies ahead in the remainder of 2025. Respondents cited inflation and rising input costs (53%), tariffs and trade regulations (47%), and regulatory uncertainty (35%) as top concerns, along with declining sales/consumer demand, labor shortages, and rising interest rates.

“These results, while sobering, aren’t surprising. We’re hearing from clients every day who are trying to navigate this shifting landscape. The uncertainty spans industries and regions, and businesses are looking for practical strategies to adapt and stay resilient,” said Jim Giszczak, co-president of McDonald Hopkins.

One respondent summarized the mindset of many: “The goal is to lean down some, stay flexible, have little turnover, and hope for some future stability.”

Comparatively, while most respondents expect national business conditions to decline by the end of 2025, only 29% expect a decline in their company’s performance. Thirty-seven percent believe their own business will improve, and 34% anticipate no significant change whatsoever.

“We are diversified and supply most of our businesses with U.S.-made products,” one respondent stated.

When asked whether any recent policy developments or executive orders during the first 100 days of the current administration had impacted their business, 48% reported a negative impact, while 32% said they had seen no impact. Tariff uncertainty was the most common roadblock respondents mentioned, along with the impact of DOGE activity.

“Putting off other purchases helped us avoid crippling prices while the maximum tariffs were in effect. The see-saw effect of the chaotic tariff policies is causing our supply prices to rise, but we are too small to pass those costs along to our customers yet,” said one respondent. While another stated, “The instability of tariffs is making planning exceptionally hard. We deal with items with long lead times, sometimes months, and there's no way to know what policies will be when products enter customs.”

“Funding received by my business that came from federal sources was all cut, leading to a 40% reduction in workforce,” said one respondent.

Looking ahead, nearly 71% of respondents indicated they do not plan to launch new products or services in the coming year, a notable shift compared to last year’s survey, where 50% of businesses indicated they were launching new products or services.

In an effort to stabilize and perhaps offset any recession concerns that lay ahead, the majority of businesses (48%) also plan to keep their current headcount and not invest in capital assets this year.

One respondent noted, “Federal funding and programs being cut means less work for my company to do,” while another stated, “We have no plans for investing for fear of financial decline.”

“No matter the challenge, McDonald Hopkins has the depth and experience to help businesses successfully manage their legal needs. From navigating tariffs to strategic growth, we’re here to be a trusted partner every step of the way,” said Jim Stief, co-president of McDonald Hopkins.

The 2025 McDonald Hopkins Business Outlook Survey was conducted between April 25, 2025, and May 17, 2025. For more information or if you’d like to talk to a member of McDonald Hopkins regarding the 2025 Business Outlook Survey results, contact Public Relations Specialist Jessi Schultz at jschultz@mcdonaldhopkins.com.