Factory output contracted again last month and at a rate that exceeded the already gloomy market expectations yet again.
Production fell 5.5 per cent in November from the same month last year - the 10th straight month of decline and far worse than the 3 per cent contraction tipped by economists polled by Bloomberg.
"This is the longest period of contraction that we have observed since our data started in 2003," said UOB economist Francis Tan.
The last long-drawn slump was during the global financial crisis when industrial production slumped for six months to March 2009 before making a sharp rebound once demand picked up.
"But the current downtrend is a mix of both lower global demand and labour market restructuring issues," Mr Tan noted.
INTEGRATION WITH SERVICES
Rather than the populist argument of being less reliant on manufacturing, it is critical to recognise this ongoing undercurrent called the 'servitisation' of manufacturing, which refers to the integration of manufacturing with services.
ANZ ECONOMIST WEIWEN NG
November's headline number was hit hard by weak activity in the electronics and transport engineering sectors, according to Economic Development Board data yesterday.
If the volatile biomedical manufacturing sector was excluded, output fell 6.4 per cent from a year ago.
Chemicals was the only one of Singapore's six manufacturing clusters to expand last month.
Transport engineering output fell 11.2 per cent from a year ago, dragged down by a 20.1 per cent contraction in marine and offshore engineering and a 20.7 per cent contraction in land transport engineering.
The marine and offshore engineering segment was hit hard by tumbling oil prices. Brent crude oil, the international benchmark, reached an 11-year low of US$36.04 on Monday.
The oil market's prolonged uncertainty forced many customers to delay taking ownership of the oil rigs and specialised vessels they had ordered, said CIMB Private Bank economist Song Seng Wun.
Electronics output, which makes up about a third of all factory activity here, fell 11.1 per cent last month, as all segments except data storage and other electronic modules and components registered lower activity.
But economists were also optimistic that factories would get busier in the second half of next year when a more stable China is expected to anchor an Asian recovery.
Mr Song also junked notions that Singapore's manufacturers are becoming less of a growth pillar as the economy restructures.
"Singapore is still seen as an attractive place for manufacturers, despite the relatively high costs of getting their factories up and running," he said.
The electronics cluster attracted the largest fixed-asset investment commitments of $1.5 billion in the third quarter, mainly from the semiconductor segment.
"Rather than the populist argument of being less reliant on manufacturing, it is critical to recognise this ongoing undercurrent called the 'servitisation' of manufacturing, which refers to the integration of manufacturing with services," said ANZ economist Weiwen Ng.