OCBC SME Index: Which sectors are the best and worst performers of 4Q23?

Overall, SMEs' performance and health remained in a state of contraction with a 49.5 reading.

The performance and health of small and medium enterprises (SMEs) in Singapore continued to deteriorate in 4Q23, according to the latest OCBC SME Index.

SMEs remained in a state of contraction for the fourth consecutive quarter in 4Q23 with a 49.5 reading, lower than the 49.6 reading in 3Q23. 

“SME collections and payments dropped by 3.1% and 2.0% year-on-year against the backdrop of soft external demand and domestic cost challenges,” OCBC reported.

Based on the latest reading, Retail (50.9), Building & Construction (50.3), and Healthcare (50.2) were the only industries in the expansionary territory.

On the flip side, several consumer-facing industries such as F&B (49.6), Education (49.7) and Business Services (49.3), turned slightly contractionary for the first time after multiple quarters of expansion.

Remaining in the contractionary territory were Resources (49.7), Manufacturing (49.4), Wholesale Trade (49.1), ICT (48.3), and Transport and Logistics (47.8).

“The OCBC SME Index is likely to remain flat in the near term due
to weak demand and growing business costs, before potentially
turning expansionary in the latter part of the year with a recovery
in manufacturing and the externally oriented sectors,” OCBC said.