SINGAPORE - The business expectations of Singapore firms in both the manufacturing and services sectors improved as ongoing Covid-19 vaccinations across countries raised global economic prospects.
Their more upbeat sentiments were captured in the latest quarterly surveys released separately by the Economic Development Board (EDB) and the Department of Statistics (SingStat) on Friday (April 30).
A weighted 41 per cent of manufacturers see business conditions improving over the next six months, while a weighted 3 per cent foresee a weaker business outlook, the EDB survey showed.
Thus, a net weighted balance of 38 per cent of manufacturing firms anticipate a favourable business situation from April to September. This compares to 32 per cent of firms in the previous quarter's poll.
A weighted percentage refers to an aggregate of the responses of manufacturers based on their proportion of the manufacturing sector.
The electronics cluster was the most optimistic, with a net weighted balance of 66 per cent of firms having a positive business outlook.
This sentiment was driven mainly by the semiconductors and other electronic components segments, which project higher export orders on account of robust demand from 5G markets, said EDB.
The services sector also grew more optimistic, with a net weighted balance of 11 per cent of firms expecting a more favourable business outlook, an improvement on the 7 per cent that was seen in the previous survey by SingStat.
Within the services sector, the information and communications, finance and insurance, and wholesale trade industries are among those that expect business conditions to improve for the next six months.
But the accommodation and retail trade industries expect weaker business conditions ahead.
On the accommodation front, hoteliers expect slow pick-up in demand due to continued entry restrictions and border closures.
In the retail trade industry, department stores and supermarkets are less optimistic in their business outlook.
Overall, the services sector expects an increase in hiring activity for the second quarter this year, with a net weighted balance of 6 per cent of firms indicating as such.
The recreation, community and personal services industry as well as the information and communications industry expect an increase in employment in the next three months, until June.
Conversely, firms in the accommodation industry expect lower employment level in view of weak demand.
In the manufacturing sector, a majority of firms - a weighted 77 per cent - expect the employment level in the second quarter of this year to remain similar to the first quarter.
For the manufacturing sector, a net weighted balance of 9 per cent of firms plan to hire more workers in the second quarter of this year.
The biomedical manufacturing, electronics and precision engineering clusters were the most optimistic in their employment outlook.