The Singapore Business Federation (SBF) has unveiled the National Business Survey (NBS) 2024 – Annual Business Sentiments Edition, signalling renewed optimism among Singapore’s businesses. Released on Thursday, 2 January 2025, the survey captures a notable shift in sentiment, with 40% of businesses satisfied with the current economic climate – a 10-percentage-point rise since mid-2024. Encouragingly, more companies anticipate an economic upturn (26%) over a downturn (22%) in the next year.
Conducted between 11 October and 11 November 2024, the survey gathered insights from 519 businesses across key sectors, with 83% representing small and medium-sized enterprises (SMEs). The findings will shape SBF’s Budget 2025 recommendations, aimed at bolstering Singapore’s global competitiveness.
Rising Costs, Resilient Profits
Despite challenges like manpower costs (66%) and increasing rental expenses (43%), over half of the surveyed businesses (57%) reported maintaining or improving profitability in 2024. Still, 43% saw profits dip by an average of 27.5%, prompting cost-saving measures (51%) and price adjustments (41%).
Customer demand uncertainty, now a concern for 45% of businesses, has overtaken rental costs as a top issue. Hardest-hit industries include Hotels, Restaurants, and Accommodations (80%), Retail Trade (75%), and Wholesale Trade (59%).
While 54% of businesses face no liquidity issues, a worrying 25% report severe credit crunches, with 40% of these struggling to sustain operations beyond six months. In response, companies are tightening budgets and seeking government support to mitigate financing challenges.
Building for the Future
Optimism extends to investments, with more businesses prioritising staff training (36%), digitalisation (37%), and new investments (26%) – all showing year-on-year increases.
“It is encouraging to see a growth in optimism on business outlook, reflecting our businesses’ resilience, adaptability and preparedness for the future,” said Mr Kok Ping Soon, CEO of SBF.
Balancing Local and Foreign Talent
Amid local manpower shortages, 59% of businesses report positive sentiments towards foreign workers, though fewer now regard Singapore as a top-tier global talent hub (41%, down from 43%). The decline is more acute among large companies, dropping from 55% to 47%.
Integration remains a gap, with only 1 in 5 companies adopting Diversity, Equity, and Inclusion (DEI) policies or promoting cultural integration.
“With only 1 in 5 businesses providing integration activities, more can be done to foster collaboration between locals and foreigners,” added Mr Kok.
Budget 2025: Business Priorities
Businesses are urging support for cost management (64%), local workforce retention (43%), and foreign manpower challenges (41%). The Corporate Income Tax rebate (88%) and SkillsFuture initiatives (78%) remain the most appreciated Budget 2024 measures.
The SBF-PwC Budget Recommendations, slated for release on Thursday, 9 January 2025, aim to address these pressing concerns.
As geopolitical tensions loom, Mr Kok noted: “External factors such as trade tensions and regional conflicts are likely to dominate business concerns in the coming year.”
