ECONOMY | Staff Reporter, Singapore

Services sector gets bearish on business in H1 2019

Firms in the accommodation, transport and wholesale trade industries were the most pessimistic.

Firms in the services sector expect less favourable business conditions for the next six months compared to H2 2018, with a net weighted balance of 4% companies pessimistic about their prospects compared to the 3% recorded previously, according to the Department of Statistics Singapore’s (SingStat) Business Expectations Survey.

The survey which covers over 1,500 enterprises across several services segments found that the information & communications, and food & beverage (F&B) services industries were amongst those that expected favourable business conditions in H1 2019 compared to H2 2018.

In particular, firms engaged in computer consultancy as well as web portal services were positive about their business outlook, SingStat observed. Fast food outlets and food caterers also expect business conditions to improve in the coming six months.

Also read: APAC CEOs more optimistic than global average

On the other hand, firms in the accommodation industry were less optimistic compared to H2 2018 which coincided with the year-end holiday and festive period.

“Similarly, firms in the transport & storage industry forecasted business conditions to be less favourable,” SingStat noted. “In particular, air transport firms expect lower demand in the coming six months, compared to the period of July to December 2018 which includes the year-end school holiday period.”

Likewise, companies in the wholesale trade and financial & insurance industries expect business conditions to worsen, on the back of the ongoing trade conflict between US and China which is expected to have a negative impact on their respective businesses.

Also read: Singapore shuns tightening amidst global economic slowdown

In terms of operating receipts, firms in the accommodation, wholesale trade and transport & storage segments expect revenue to decrease. Those within the information & communications and F&B services industries however, are optimistic in their revenue outlook for Q1 2019.

Meanwhile, firms in the F&B services and retail trade industries expect employment levels to increase, with food caterers and supermarkets amongst those expecting to increase hiring in Q1 2019, SingStat added.

Companies within the accommodation, real estate and financial & insurance industries however, were observed to be amongst those that expect to reduce hiring activity in Q1 2019.

Do you know more about this story? Contact us anonymously through this link.

Click here to learn about advertising, content sponsorship, events & rountables, custom media solutions, whitepaper writing, sales leads or eDM opportunities with us.

To get a media kit and information on advertising or sponsoring click here.