Organisations in Singapore turn optimistic despite challenges

The Singapore Business Federation (SBF) released the National Business Survey (NBS) 2024 – Annual Business Sentiments Edition, revealing a more positive outlook for the Singapore economy. While challenges persist, organisations demonstrate resilience and a focus on future growth.

Key findings from the survey include a significant increase in business satisfaction with the current climate, with 40% of organisations expressing satisfaction, a 10-percentage point jump since mid-2024. Moreover, optimism for economic growth is on the rise, with 26% of organisations expecting improvement in the next 12 months, outpacing the 22% anticipating a downturn.

Despite rising business costs, particularly manpower costs (66%) and customer demand uncertainty (45%), a notable 57% of organisations have managed to maintain or increase profitability over the past year. To navigate these challenges, organisations have implemented various strategies, including cost-saving measures (51%), price increases (41%), and improved inventory management (30%).

While recognising the need for a complementary foreign workforce, the survey indicated a slight decline in Singapore’s perceived attractiveness as a global talent hub. Only 41% of organisations currently rate Singapore highly as a talent destination, down from 43% in the previous 12 months. This decline is more pronounced among large organisations.

Looking ahead, organisations are prioritising investments in their future. 36% plan to focus on employee training, 37% on new technologies and digitalisation, and 26% on new investments over the next 12 months.

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Organisations also continue to seek government support in areas such as managing financing needs (35%), human capital development (34%), and digitalisation for business transformation (33%). Their top three wishes for Budget 2025 include schemes to address cost pressures (64%), support for attracting and retaining the local workforce (43%), and addressing foreign manpower issues (41%).

Kok Ping Soon, CEO of SBF, commented, “As we move into 2025, it is encouraging to see a growth in optimism on business outlook, reflecting our businesses’ resilience, adaptability and preparedness for the future by investing in capability building.”

“While rising business cost is a perennial concern which needs to be addressed, we are heartened that more organisations are prepared to invest in people, technology and new businesses. Given our manpower constraints, we need to increase Singapore’s absorptive capacity of a complementary workforce to maintain our attractiveness as a global talent hub. With only one in five organisations have DE&I policies and providing community or cultural integration activities, organisations can do more to integrate locals and foreigners at the workplace.”