1 in 10 services firms brace for slower business in 1H18

Only 3% of firms expect a better business situation, a dip from 9% last quarter.

The balance of services sector firms optimistic about business in the first half of 2018 dipped from +9% last quarter to +3%, but it is still an improvement from last year's balance of -14%, the Department of Statistics Singapore (SingStat) revealed.

According to its business expectations survey, overall, a weighted 15% of firms are optimistic about business, whilst 12% of firms foresee slower business. About 73% of the firms anticipate the level of business activity to remain the same.

Within the services sector, the financial & insurance, wholesale trade and recreation, community & personal services industries are amongst those which foresee more favourable business conditions.

About 18% of firms in the financial industry expect better business conditions in the next six months.

"Within the industry, banks and insurance companies are among those that expect more favourable business conditions as they foresee an improvement in the global economic conditions."

Wholesale trade companies also expect an improved business situation. In particular, wholesalers of machinery, equipment & supplies are more optimistic in their business outlook as they expect an increase in demand for their products.

Meanwhile, the accommodation, transport & storage, and food & beverage services industries are less optimistic in their business outlook.

In terms of operations, only 3% expect an increase in operating receipts for the next six months, with firms in the financial & insurance and recreation industries leading the optimism. Companies in the accommodation and food & beverage industries expect lower turnover.

In terms of employment, firms that expect hiring to remain at a similar level with a net weighted balance of 1%. Those in the financial, recreation, community, and retail industries project higher hiring activity, as opposed to those in the accommodation and business services industries.