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F&B, arts, construction, retail still feel the pinch

Even though theatres are now open, shows are still being run at a loss due to safe distancing rules. Wild Rice @ Funan (left), for one, has been running productions at less than 25 per cent capacity. PHOTO: WILD RICE
Even though theatres are now open, shows are still being run at a loss due to safe distancing rules. Wild Rice @ Funan (left), for one, has been running productions at less than 25 per cent capacity. PHOTO: WILD RICE

Employers in the food, retail, arts, and construction sectors welcomed the Government's plans to extend wage support for them until June, but many feel it is not enough. Safe management measures and a labour crunch caused by border restrictions mean they will continue to feel the pinch.

HANGING ON

Mr Ivan Heng, the founder and artistic director of home-grown theatre company Wild Rice, said the 10 per cent wage subsidy "does not reflect the dire reality of the situation".

The arts scene in Singapore has been battered by the pandemic. Theatre groups, for instance, are still reeling from the closure of theatres for several months last year.

Although theatres are now open, shows are still being staged at a loss because safe distancing measures mean that even a sold-out run will have only a fraction of the seats filled. Wild Rice @ Funan, for instance, has been running at less than 25 per cent capacity.

"This has a huge impact on ticket revenue. There's also a fatigue for digital offerings. So companies have hardly any means of earning any income," Mr Heng said.

He added that in theatres and concert halls, the authorities could consider relaxing safe distancing restrictions. "Compared to the crowds on public transport, malls, markets, restaurants and not forgetting cinemas, do theatres pose such a danger to the public?"

He said: "Jobs and livelihoods are at stake... If the situation persists, the industry will not recover."

In the construction industry, firms are resuming Covid-19-delayed projects but face challenges such as manpower and cash-flow issues, supply chain disruptions, as well as rising material and manpower costs.

The industry relies heavily on foreign workers, who do not qualify for the Jobs Support Scheme (JSS).

HSL Group's chief executive Charles Quek said that while he was glad wage support for local employees would be extended at 10 per cent, till June, he had hoped for more foreign worker levy rebates, which had been given out previously.

"The wages for workers - whether it's foreign workers, S pass workers or even local workers - are going up, because of lack of manpower in the industry. Material prices have also shot up, and dormitory and other associated costs have gone up too because of safe management measures."

HSL Group has 17 subsidiaries in South-east Asia, including eight in Singapore.

Mr Quek said productivity of his group is down by at least 20 per cent owing to manpower shortage and safe management measures.

He added that he has also raised workers' wages by 10 per cent to 15 per cent in a bid to retain them.

Mr Quek said the group will likely reduce its exposure to long-term, big projects that run into the hundreds of millions. "I think those will be very risky. With an expected continued manpower crunch, I think costs will get higher. There's also the risk of a second wave (of infections). I don't know how many companies would be able to withstand another shock like that."

Singapore Retailers Association's president R. Dhinakaran said many retailers had hoped for at least 25 per cent wage support, since overheads such as rent in many cases remain the same but sales are still down.

Many firms are "aggressively marking down" their goods to get more cash flow to meet these overheads, and this is not sustainable, he said.

RECOVERING

Food and beverage operators had hoped the JSS would last till the vaccination of Singapore's population was complete, the Restaurant Association of Singapore (RAS) said.

A spokesman said sales across the industry are still at 50 per cent to 80 per cent of pre-Covid-19 levels, adding that safe management measures had effectively cut seating capacity by 30 per cent to 40 per cent.

But the latest wage support would "no doubt help the forward-looking F&B brands who have pivoted their business model to the new normal", such as those that stepped up online marketing and deliveries, or introduced virtual brands and ready-to-cook products, the spokesman added.

News of the wage support was a "pleasant surprise" to Foodtech F&B Ventures' chief executive Serene Ang, whose company runs four restaurants and more than a dozen kiosks across the island.

She said cost savings from earlier tranches of wage support helped the firm to hire more locals and train existing staff.

It also increased staff wages.

Ms Ang said: "The whole industry is very thirsty for staff, since foreigners can't come in as freely as before. A part-time ground service crew member working 36 to 40 hours a week used to be paid $1,500 a month, but I'm now paying up to $1,800 just to keep them. The Malaysian workers stuck here are in greater demand than ever."

Ms Ang, who has 80 staff, is cautious about expanding and said she will think twice about renewing some outlets' leases, especially if the company can secure cheaper rent elsewhere.

RAS' spokesman said the shortage of suitable manpower in F&B is a "major constraint that needs to be further addressed".

"We hope the Government will continue to monitor and make adjustments to relevant policies if the situation does not improve in spite of higher wages and enhanced working conditions."

A version of this article appeared in the print edition of The Sunday Times on February 21, 2021, with the headline 'F&B, arts, construction, retail still feel the pinch'. Subscribe