Manufacturing firms mostly optimistic but outlook mixed for services sector: Surveys

Workers at Panasonic's refrigerator compressor factory in Bedok.
Workers at Panasonic's refrigerator compressor factory in Bedok.ST PHOTO: JOYCE FANG

SINGAPORE - Things are looking up in general for the manufacturing sector but sentiments were more mixed for companies in the services sector, two separate surveys released on Friday showed (April 28).

A weighted 12 per cent of manufacturers expect business conditions to improve in the six months to September, while just 5 per cent expect them to weaken, a survey by the Singapore Economic Development Board found.

The optimism was widespread within the sector, with all clusters except the general manufacturing industries, anticipating business prospects from the previous quarter.

The electronics and the precision engineering clusters lead the optimism, with 16 per cent of firms in each cluster projecting favourable business conditions for the April-September period compared to a quarter ago.

In the electronics cluster, the semiconductor firms anticipate strong market demand for chips used in smartphones, automotive and data storage applications. Additionally, the other electronic modules & components segment expects more orders from China, US and EU in the months ahead.

In the precision engineering cluster, the machinery & systems segment foresees better business prospects, largely supported by the semiconductor-related equipment industry. Sentiments in the precision modules & components segment is expected to turn positive as incoming orders improve, particularly for optical instruments, metal stamping, bonding wire and dies, moulds, jigs & fixtures.

For the services sector, the outlook was more mixed although, overall, more firms (14 per cent) were optimistic about business conditions for the next six-month period compared to the survey results a quarter ago (10 per cent).

The survey by the Singapore Department of Statistics found information & communications and wholesale trade firms were more bullish while retail trade, food & beverage and transport & storage services firms were less optimistic.