Services sector’s business outlook dims for Q123

Sixteen (16%) per cent of firms foresee deteriorating business conditions.

Firms in the services industry have become less positive about their business conditions in the first quarter of the year.

Data from the Department of Statistics (SingStat) showed that the net weighted balance of firms expecting more favourable business conditions has moderated for the January to June 2023 period (3%) from October 2022 to March 2023 period (9%).

For Q1, only 19% of firms are upbeat about the business conditions, whilst 16% of firms foresee deteriorating business conditions.

Overall, however, SingStat said most of the industries within the services sector still have a positive outlook about their business conditions for the period of January to June 2023, except Wholesale Trade (-6%), Food & beverage Services (-10%), and Information & Communications (-4%).

Meanwhile, firms in the accommodation (+16%) and transportation & storage (+12%) industries are the most upbeat about their business conditions.

“Hoteliers cite the upswing of international travel and increased tourist arrivals in Singapore as reasons for their optimism,” SingStat said.

“Within the transportation & storage industry, airlines attributed their bright outlook to the continued recovery of international travel,” it added.