Manufacturers Expect Lower Output and Hiring Activities in Q4
Singapore’s manufacturers and services sectors have shown slightly more optimism for the upcoming six months, as recent surveys indicate a modest improvement in business outlooks for both industries. According to the Economic Development Board (EDB), 7% of manufacturers are optimistic about the period from October to March, marking the third consecutive quarter of positivity after a period of pessimism. For services, the Department of Statistics reported a 9% optimism rate, a slight increase from the previous quarter.
Despite this optimism, manufacturers foresee a decline in output and hiring activities in the fourth quarter. A net weighted balance of 10% of manufacturers expect lower output, with segments such as precision engineering leading the decline. Meanwhile, industries like transport engineering and chemicals project higher production levels.
Among services firms, optimism is driven by industries benefiting from year-end festivities and ongoing tourism recovery. Accommodation, retail trade, and food services expect higher sales due to festive periods, with inbound tourism predicted to return to pre-pandemic levels in 2024. Professional services, especially in accounting, consultancy, and engineering, have seen a sharp increase in optimism, contributing to the overall positive sentiment.
The overall outlook for both sectors remains cautious, with challenges such as high interest rates and geopolitical tensions influencing manufacturers’ expectations, while services are buoyed by tourism and seasonal demand. Both sectors anticipate slight improvements in hiring activities in Q4, with services particularly expecting robust job growth across industries.
