Firms in the services and manufacturing sectors are increasingly upbeat about prospects for the next six months, two surveys show.
Manufacturers showed more optimism, with a net weighted balance of 13 per cent of firms forecasting more favourable conditions for the period to September. This compares with a net weighted balance of only 1 per cent in the previous quarter's survey.
The net weighted balance is the difference between the proportion of optimistic and pessimistic firms.
All clusters in the manufacturing sector are optimistic about the next six months compared with the first quarter this year.
About 80 per cent of manufacturers also expect their business situation to remain the same, according to the Economic Development Board (EDB) study.
Precision engineers are the most optimistic, with a net weighted balance of 39 per cent of firms anticipating improved conditions for the April to September period.
This sentiment is largely led by the machinery and systems segment, which foresees continued strong demand for semiconductor-related equipment.
A net weighted balance of 14 per cent of firms in the electronics cluster expect a favourable operating environment to prevail in the next six months, while 10 per cent of biomedical firms anticipate improving conditions.
Similarly, in the transport engineering cluster, a net weighted balance of 9 per cent of firms expect a positive business outlook.
Aerospace companies foresee more aircraft engine repair orders, while the marine and offshore engineering segment anticipates marginal improvement in conditions amid a modest pick-up in crude oil prices, the EDB said.
However, the survey also found that a net weighted balance of 4 per cent of manufacturers plan to hire fewer workers in this quarter compared with the first quarter.
The weak employment outlook came largely from the transport engineering cluster.
There was optimism in the services sector with a net weighted balance of 8 per cent of firms expecting more favourable conditions for the next six months.
This is an improvement from the net weighted balance of 3 per cent recorded in the previous quarter's survey.
A weighted 17 per cent of firms are optimistic about the the next six months, while a weighted 9 per cent anticipate slower business.
Almost 75 per cent of firms expect the level of activity to remain the same, according to a survey by the Department of Statistics.
The financial and insurance, wholesale trade, and real estate industries are among the segments that envisage more favourable business conditions.
In contrast, firms in the retail, accommodation and food and beverage industries expect prospects to deteriorate over the April-September period compared with the previous six months, which coincided with the Christmas period.