FullReport AES2022

ECONOMIC
SURVEY OF
SINGAPORE
2022
February 2023
Ministry of Trade and Industry

Republic of Singapore
website: www.mti.gov.sg
email: [email protected]
All rights reserved. No part of this publication may be reproduced,

stored in a retrieval system or transmitted in any form or by any means,
electronic, mechanised, photocopying, recording or otherwise, without
the prior permission of the copyright holder.
CONTENTS
02 Main Indicators of the

Singapore Economy 52 CHAPTER 6
Sectoral Performance
56 6.1 Manufacturing
58 6.2 Construction
62 6.3 Wholesale Trade
06 CHAPTER 1
Economic Performance
63
64
6.4 Retail Trade
6.5 Transportation & Storage
66 6.6 Accommodation
68 6.7 Food & Beverage Services
69 6.8 Information & Communications
14 CHAPTER 2 70 6.9 Finance & Insurance

Labour Market and Productivity 74 6.10 Real Estate and Professional Services
76 BOX ARTICLE 6.1

Trends in the Recovery in Retail and Food
& Beverage Spending in Singapore
22 CHAPTER 3
Costs, Investments and Prices
27 OX ARTICLE 3.1
B
Business Cost Conditions in Singapore’s
Manufacturing and Services Sectors 84 CHAPTER 7
Economic Outlook
38 CHAPTER 4
I nternational Trade 86 FEATURE
ARTICLE
88 Impact of the Jobs Growth Incentive

(JGI) Scheme on Firm-level Local
Labour Outcomes
44 CHAPTER 5
Balance of Payments
02 Economic Survey of Singapore 2022
MAIN INDICATORS OF
THE SINGAPORE ECONOMY
OVERALL ECONOMY
2021 2021 2021

$569.4 billion +8.9% $87,308
GDP
at Current
2022
Real GDP 2022 GNI 2022
Market Price $643.5 billion (Year-on-Year-Growth) +3.6% Per Capita $95,787
STRUCTURE OF THE ECONOMY IN 2022 (% OF NOMINAL VA)

BREAKDOWN OF SERVICES PRODUCING INDUSTRIES
Wholesale Finance & Transportation
Trade Insurance & Storage
18.6% 13.5% 10.4%
Information & Professional Administrative &
Communications Services Support Services
5.4% 5.4% 3.0%
Real Retail Food & Beverage
Services Producing Ownership Estate Trade Services
Industries of Dwellings
71.3% 3.3% 2.9% 1.3% 0.9%
Goods Producing Other Services
Industries Manufacturing Construction Accommodation Industries
25.4% 21.6% 2.7% 0.7% 9.3%
LABOUR MARKET COST PRICES

Employment Unit Labour Cost of Consumer Price Index
(as at year end) Overall Economy – All Items
2021 2022 2021 2022 2021 2022
3,643.5 3,897.5 +4.9% +8.5% +2.3% +6.1%
thousand thousand
Overall Unit Business Cost Domestic Supply

Unemployment Rate of Manufacturing Price Index
2021 2022 2021 2022 2021 2022
2.7% 2.1% +0.1% +9.6% +15.2% +18.6%
Value-Added per Unit Labour Cost Singapore Manufactured

Actual Hour Worked of Manufacturing Products Price Index
2021 2022 2021 2022 2021 2022
+6.7% -0.8% +0.4% +9.6% +9.5% +14.9%
Main Indicators of the Singapore Economy 03
MERCHANDISE TRADE SERVICES TRADE

Merchandise Exports Services Exports
2021 2022 2021 2022
$614,081 $709,967 $358,081 $401,544

million million million million
+19.1% +15.6% +21.2% +12.1%
Merchandise Imports Services Imports

2021 2022 2021 2022
$545,882 $655,436 $326,233 $356,543

million million million million
+20.4% +20.1% +11.6% +9.3%
Share of Total Merchandise Exports in 2022 Share of Total Services Exports in 2022
53.6% 28.1% 18.4% 34.9% 28.7% 13.7% 8.0% 4.2%

Re-exports Non-Oil Domestic Oil Domestic Transport Other Financial Telecomms, Charges for
Exports Exports Services Business Services Computer and the use of
Services Information Intellectual
Property
Top Trading Partners in 2022 Top Trading Categories in 2022
Exports $88.2b Exports $140.0b

Transport
Imports $86.8b Services
Imports $127.0b
China

Other
Imports $81.9b Business
Imports $111.5b
Malaysia
Services

Imports $71.0b Financial
Services
Imports $15.5b
United States
CHAPTER
ECONOMIC
1 PERFORMANCE
Chapter 1
ECONOMIC
PERFORMANCE
REAL GDP GREW BY 3.6% IN 2022 QUARTERLY GDP GROWTH IN 2022
(Year-On-Year Growth)
5 4.5%
10 4.0% 4.0%
8.9% 4
3 2.1%
2
5 1
3.6% 0
1Q 2Q 3Q 4Q
0
MAIN DRIVERS OF GDP GROWTH IN 2022
Wholesale Trade Manufacturing Other
Services Industries
-5
-3.9%
2020 2021 2022
0.6% 0.5% 0.5%

point contribution point contribution point contribution
INCOME COMPONENTS OF GDP IN 2022 SOURCES OF GROWTH IN 2022
External Domestic
Demand Demand
Gross Operating
Surplus
57.7% Consumption
Expenditure Gross Fixed
2 Capital
+1.0% Formation
point
1
Compensation Taxes Less +0.1%
of Employees Subsidies point
36.6% on Production 0
5.8% -0.1%
-1 point
-1.0% Changes in
-2 point Inventories
Chapter 1: Economic Performance 07
OVERVIEW
In the fourth quarter of 2022, the Singapore economy grew by 2.1 per cent on a year-on-year basis, moderating
from the 4.0 per cent expansion in the previous quarter. All sectors expanded during the quarter, with the exception
of the manufacturing and finance & insurance sectors. The sectors that contributed the most to growth during
the quarter were the other services, wholesale trade and real estate sectors.
For the full year, the Singapore economy grew by 3.6 per cent, slower than the 8.9 per cent expansion in 2021.
All sectors recorded full-year expansions, with the wholesale trade, manufacturing and other services sectors
contributing the most to GDP growth for the year.
OVERALL PERFORMANCE The services producing industries collectively grew by

4.0 per cent year-on-year in the fourth quarter, easing
Fourth Quarter 2022 from the 5.5 per cent growth in the previous quarter. All
services sectors expanded during the quarter, except for
The Singapore economy grew by 2.1 per cent year-on- the finance & insurance sector, which contracted slightly
year in the fourth quarter, moderating from the 4.0 per by 0.3 per cent. Among the sectors that grew, the food &
cent growth in the previous quarter (Exhibit 1.1). On a beverage services (19.6 per cent) and real estate (15.2 per
quarter-on-quarter seasonally-adjusted basis, GDP grew cent) sectors posted the strongest expansions.
marginally by 0.1 per cent, slower than the 0.8 per cent
growth in the third quarter. The construction sector grew by 10.0 per cent year-on-
year in the fourth quarter, an improvement from the 8.1
Exhibit 1.1: GDP and Sectoral Growth Rates in 4Q 2022 per cent growth in the third quarter. Growth during the
Food & Beverage Services 19.6
quarter was supported by both public sector and private
sector construction works.
Real Estate 15.2
Administrative & Support 10.5
Construction 10.0 Full Year of 2022
Accommodation 7.8
Professional Services 6.1 For the whole of 2022, the Singapore economy expanded
by 3.6 per cent, moderating from the 8.9 per cent growth
Other Services Industries 6.0
in 2021 (Exhibit 1.2).
Information & Comms 5.6
Retail Trade 5.1 By sectors, the manufacturing sector grew by 2.5 per
Transportation & Storage 2.5 cent in 2022, a marked slowdown from the 13.3 per cent
Wholesale Trade 2.4 growth achieved in the preceding year. Growth in the sector
Overall GDP Growth 2.1
for the year was supported by output expansions across
all clusters, except for the chemicals and biomedical
Finance & Insurance -0.3
manufacturing clusters.
Manufacturing -2.6
-10 -5 0 5 10 15 20 25 Services producing industries posted growth of 4.8 per
Per Cent
cent in 2022, easing from the 7.6 per cent expansion in
2021. All services sectors registered full-year expansions,
The manufacturing sector contracted by 2.6 per cent year- with the food & beverage services (18.2 per cent) and
on-year in the fourth quarter, a pullback from the 1.1 per real estate (14.1 per cent) sectors recording the fastest
cent growth in the preceding quarter. All clusters within growth in 2022.
the sector recorded contractions during the quarter, except
for the transport engineering and precision engineering Meanwhile, the construction sector grew by 6.7 per cent in
clusters. 2022, extending the 20.5 per cent expansion in the preceding
year. Output growth in the sector was supported by an
increase in both public and private sector construction
works.
Exhibit 1.2: GDP and Sectoral Growth Rates in 2022 Exhibit 1.3: Percentage-Point Contribution to Growth in Real
GDP in 4Q 2022 (By Sectors)
Real Estate 14.1 Overall GDP Growth 2.1
Information & Comms 8.6 Other Services Industries 0.6
Retail Trade 8.4 Wholesale Trade 0.4
Professional Services 7.6 Real Estate 0.4
Construction 6.7 Professional Services 0.3
Administrative & Support 6.6 Administrative & Support 0.3
Other Services Industries 5.2 Information & Comms 0.3

Transportation & Storage 4.0 Construction 0.2
Overall GDP Growth 3.6 Transportation & Storage 0.2

Wholesale Trade 3.2 Food & Beverage Services 0.1
Manufacturing 2.5 Retail Trade 0.1
Finance & Insurance 1.4 Accommodation 0.0
Accommodation 0.5 Finance & Insurance 0.0

0 5 10 15 20 Manufacturing -0.5
Per Cent -1 0 1 2 3
Per Cent
Contribution to Growth Exhibit 1.4: Percentage-Point Contribution to Growth in Real

GDP in 2022 (By Sectors)
In the fourth quarter, all sectors contributed positively to
GDP growth, except for the manufacturing and finance & Overall GDP Growth 3.6
insurance sectors (Exhibit 1.3). Among the sectors that Wholesale Trade 0.6
expanded, the other services, wholesale trade and real Manufacturing 0.5
estate sectors were the top contributors to GDP growth Other Services Industries 0.5
during the quarter.
For the whole of 2022, all sectors contributed positively Professional Services 0.4
to GDP growth, with the wholesale trade, manufacturing Real Estate 0.4
and other services sectors contributing the most to GDP Transportation & Storage 0.3
growth for the year (Exhibit 1.4). Administrative & Support 0.2
Finance & Insurance 0.2
Construction 0.2
Retail Trade 0.1
Accommodation 0.0
0 1 2 3 4
Per Cent
SOURCES OF GROWTH Domestic Demand

Total demand fell by 4.1 per cent year-on-year in the Total domestic demand rose by 4.6 per cent year-on-year
fourth quarter, a reversal from the increase of 3.1 per in the fourth quarter, an improvement from the 2.8 per
cent in the previous quarter (Exhibit 1.5). This was due to cent growth in the previous quarter. The pickup in domestic
a fall in external demand during the quarter, which was demand during the quarter was supported by an increase
partially offset by a rise in domestic demand. in consumption expenditure, which more than offset a fall
in gross fixed capital formation.
For 2022 as a whole, total demand edged up by 0.1 per
cent, weakening from the 11.1 per cent increase in 2021. For 2022 as a whole, total domestic demand expanded by
Growth in total demand was supported by a rise in domestic 4.3 per cent, moderating from the 9.4 per cent growth in
demand (1.1 percentage-points) even as external demand 2021. The increase in domestic demand was supported by
declined (-1.0 percentage-points). growth in both consumption expenditure and gross fixed
capital formation, even as inventories declined.
Exhibit 1.5: Percentage-Point Contribution to Total
Demand Growth
Consumption Expenditure
2022
2021 2022
I II III IV Total consumption expenditure rose by 6.7 per cent year-
on-year in the fourth quarter, extending the 7.9 per cent
Total Demand 11.1 -0.8 2.4 3.1 -4.1 0.1 increase in the previous quarter.
External Demand 8.6 -1.3 0.5 2.4 -5.2 -1.0 For the full year, total consumption expenditure picked
up by 6.5 per cent, faster than the 5.8 per cent growth
Total Domestic
2.5 0.6 1.9 0.7 1.2 1.1 in 2021. The increase in consumption expenditure was
Demand
driven by an expansion in private consumption which
Consumption outweighed a decline in public consumption. Specifically,
1.0 0.2 1.6 1.3 1.1 1.0
Expenditure private consumption rose by 9.7 per cent, attributable in
part to an increase in expenditure on miscellaneous goods
Public 0.2 -0.2 0.0 -0.2 0.0 -0.1
& services and recreation & culture. At the same time,
public consumption fell by 2.3 per cent, a reversal from
Private 0.9 0.5 1.6 1.4 1.1 1.2
the 3.7 per cent expansion in 2021.
Gross Fixed
1.5 0.2 0.2 0.3 -0.1 0.1 Exhibit 1.6: Changes in Total Demand in Chained (2015) Dollars
Capital Formation
Changes in Per Cent
0.0 0.2 0.1 -0.9 0.2 -0.1
Inventories 15
External Demand 10
Domestic
External demand shrank by 7.0 per cent year-on-year in

the fourth quarter, a sharp pullback from the 3.2 per cent 5
growth in the previous quarter (Exhibit 1.6). The slump in Total
external demand could be attributed to a contraction in
the real exports of both goods and services.
0
External
For the full year, external demand contracted by 1.3 per
cent, a reversal from the 11.7 per cent expansion in 2021.
The drop in external demand could be attributed to a -5
fall in real services exports, which was in turn due to a
contraction in the real exports of transport services. By
contrast, real merchandise exports rose, led by the real -10
exports of machinery and transport equipment. IV I II III IV
2021 2022
Gross Fixed Capital Formation INCOME COMPONENTS OF

Gross fixed capital formation (GFCF) fell by 1.2 per cent
NOMINAL GDP
year-on-year in the fourth quarter, a reversal from 3.4 per Singapore’s nominal GDP amounted to $644 billion in
cent expansion in the preceding quarter. The decline in 2022, a 13.0 per cent increase over 2021. Gross operating
GFCF during the quarter was on account of a fall in private surplus accounted for 57.7 per cent of nominal GDP, while
GFCF (-1.8 per cent), which outstripped an increase in compensation of employees accounted for 36.6 per cent
public GFCF (2.0 per cent). (Exhibit 1.9). Taxes (less subsidies) on production and
imports made up the remaining 5.8 per cent of nominal GDP.
For the full year, GFCF rose by 1.6 per cent, a sharp
moderation from the 18.0 per cent increase in 2021 (Exhibit Exhibit 1.9: Income Components of GDP at Current Prices
1.7). Public GFCF decreased by 1.8 per cent, a reversal
from the 21.5 per cent growth in 2021, weighed down
mainly by lower investment spending on machinery & Compensation
Gross of Employees
equipment (Exhibit 1.8). Meanwhile, private GFCF rose Operating
36.6%
by 2.3 per cent, slower than the 17.3 per cent expansion Surplus
in 2021. The increase in private GFCF was due to higher 57.7%
investment spending across all components except for
private construction & works.
Exhibit 1.7: Annual Changes in Gross Fixed Capital

Formation in Chained (2015) Dollars, 2022 Taxes Less
Subsidies on
Production &
Total Public Private on Imports
5.8%
Total 1.6 -1.8 2.3
Construction & Works -0.5 0.4 -1.0
Transport Equipment 1.0 -21.0 2.4 NATIONAL SAVING

Machinery & Equipment 5.9 -21.7 7.9 With factor income outflows exceeding inflows by $104
billion, Gross National Income (GNI) came in at $540
Intellectual billion in 2022, lower than the $644 billion in nominal GDP.
1.2 2.8 1.1
Property Products Gross National Savings (GNS) increased by 13.5 per cent
to $265 billion in 2022. This comprised a net outflow of
$124 billion that was lent or transferred abroad, and $141
Exhibit 1.8: Percentage-Point Contribution to Growth of Gross billion in Gross Capital Formation. The national savings
Fixed Capital Formation in Chained (2015) Dollars, 2022 rate was 49.2 per cent of GNI in 2022, similar to the 49.1
per cent observed in 2021.
Total Public Private
Total 1.6 -0.3 1.9
Construction & Works -0.2 0.1 -0.3
Transport Equipment 0.1 -0.1 0.2
Machinery & Equipment 1.3 -0.3 1.7
Intellectual
0.4 0.1 0.3
Property Products
GNI AND THE EXTERNAL Exhibit 1.10: Singapore’s Earnings from External Economy
as a Proportion of Total Income
ECONOMY Per Cent
Factor income from abroad reached $217 billion in 2022, 30
up from the $196 billion in 2021. The contribution of
overseas operations to the total economy was 25.2 per
cent in 2022, slightly lower than the contribution of 25.7 25
per cent recorded in 2021 (Exhibit 1.10).
Based on the Department of Statistics’ Survey of Singapore’s 20

Investment Abroad, the stock of direct investment abroad Factor Income From Abroad (FIFA)
increased from $1,148 billion in 2020 to about $1,238 GDP + FIFA
15
billion in 2021.
10
0
2002 2007 2012 2017 2022
CHAPTER LABOUR
2 MARKET AND
PRODUCTIVITY
Chapter 2
LABOUR MARKET
AND PRODUCTIVITY
EMPLOYMENT AND PRODUCTIVITY VA PER ACTUAL HOUR WORKED
GROWTH IN 2022 AND VA PER WORKER GROWTH
Employment VA per
(as at year end) Actual Hour Worked 15
10.8%
10
6.7%
+254,000 -0.8%
5
2.6%
MAIN DRIVERS OF
EMPLOYMENT GROWTH IN 2022 0
-0.8%-1.1%
-1.9%
+91,400 +44,900 -5
employed employed 2020 2021 2022
VA per Actual Hour Worked

VA per Worker
Construction Other Services
Industries
SECTORS WITH THE HIGHEST UNEMPLOYMENT

VA PER ACTUAL HOUR WORKED RATES IN 2022
GROWTH IN 2022 Overall Resident
Unemployment Rate Unemployment Rate
+15.5% +12.8% +7.4%
Real Estate Food & Beverage Retail Trade 2.1% 2.9%

Services
ANNUALISED Per Cent Per Annum Real median gross monthly

4
CHANGE IN REAL income of full-time
GROSS MONTHLY 3
2.9% employed residents rose by
INCOME FROM WORK +1.8% per annum
2 1.8% from June 2017 to June 2022
0
20th Percentile Median
Chapter 2: Labour and Market Productivity 15
OVERVIEW1
Total employment surged by 254,000 in 2022, driven by gains in both resident and non-resident employment.
The increase in employment was experienced across all broad sectors. Excluding Migrant Domestic Workers
(MDWs), total employment grew by 231,700.
At the same time, unemployment rates and the number of retrenchments declined in 2022.
Between 2017 and 2022, the real gross monthly income of full-time employed residents at the median and 20th
percentile increased by 1.8 per cent per annum and 2.9 per cent per annum respectively.
EMPLOYMENT By broad sectors, employment rose in the services (+35,500),

construction (+14,000) and manufacturing (+2,300) sectors in
Total employment increased by 52,000 in the fourth quarter, a the fourth quarter. Within the services sector, employment
more moderate pace of increase as compared to the second gains were the largest in the other services and food &
(+71,100) and third (+83,400) quarters (Exhibit 2.1). A similar beverage services sectors (Exhibit 2.2).
trend was observed for total employment excluding MDWs.
Exhibit 2.2: Changes in Employment by Industry in 4Q 2022
Exhibit 2.1: Changes in Total Employment
Construction 14.0
Thousand
100
Retail Trade 5.9

80 Finance & Insurance 3.0
Manufacturing 2.3
Transportation & Storage 2.0

60
Professional Services 1.5
Accommodation 1.2
40 Wholesale Trade 0.8
Administrative & Support 0.4

Real Estate 0.2
20
0 5 10 15 20
Thousand
0
IV I II III IV
2021 2022
1 Figures for the fourth quarter of 2022 and full year of 2022 are based on preliminary estimates.
For the whole of 2022, total employment increased by Exhibit 2.3: Unemployment Rates (Seasonally-Adjusted)
254,000, picking up from the increase of 40,200 recorded Per Cent
in 2021. Total employment expanded across the broad 4
sectors, with the services sector (+128,000) registering the
largest gains, followed by the construction (+91,400) and
manufacturing (+34,000) sectors.
3
The expansion in total employment in 2022 occurred
on the back of gains in both resident and non-resident
employment.2 Non-resident employment accounted for most
of the employment gains during the year, due to employers 2
backfilling positions as border restrictions were lifted in
April 2022. Meanwhile, resident employment continued to
grow, particularly in the finance & insurance, information
1
& communications and other services sectors.
UNEMPLOYMENT 0
Dec Mar Jun Sep Dec
2021 2022
Between September and December 2022, the seasonally-
adjusted unemployment rate eased at the overall level Overall Resident Citizen
(from 2.1 per cent to 2.0 per cent), and for residents (from
2.9 per cent to 2.8 per cent) and citizens (from 3.1 per cent
to 3.0 per cent) (Exhibit 2.3). RETRENCHMENTS
In December 2022, there were 67,400 unemployed residents, The number of retrenchments increased in the fourth
of whom 59,800 were Singapore citizens. These were lower quarter (3,000), compared to the third quarter (1,300).
than the number of unemployed residents (70,800) and Notwithstanding the rise, the number of retrenchments in
citizens (62,400) in September 2022. the fourth quarter remained within the range of quarterly
retrenchments observed in 2019.3 Over the quarter,
For the full year of 2022, the annual average unemployment retrenchments rose in the services (from 1,050 to 2,000),
rate declined at the overall level (from 2.7 per cent in 2021 manufacturing (from 250 to 900) and construction (from
to 2.1 per cent), as well as for residents (from 3.5 per cent to 10 to 100) sectors.
2.9 per cent) and citizens (from 3.7 per cent to 3.0 per cent).
Despite the increase in retrenchments in the last quarter
In 2022, 69,600 residents, of whom 62,000 were Singapore of 2022, the total number of retrenchments for 2022 as a
citizens, were unemployed on average. These were lower whole (6,450) was lower than the level recorded in 2021
than their respective figures in 2021 (84,300 and 75,700). (8,020). The trends were mixed across the broad sectors.
Specifically, retrenchments fell in the services (from 6,020
to 4,360) and construction (from 240 to 180) sectors, but
rose in the manufacturing sector (from 1,710 to 1,910).
2 Figures for resident and non-resident employment changes for the full year of 2022 will be released in MOM’s Labour Market Report 2022 in mid-March 2023.
3 In 2019, quarterly retrenchments ranged from 2,320 to 3,230.
PRODUCTIVITY Exhibit 2.5: Changes in Value-Added per Actual Hour

Worked by Industry in 2022
Real Value-Added per Actual Hour Worked

Real Estate 15.5
Overall labour productivity, as measured by real value- Food & Beverage Services 12.8
added per actual hour worked, fell by 4.6 per cent in the Retail Trade 7.4
fourth quarter, extending the 1.8 per cent decline in the Administrative & Support 6.6
previous quarter. Wholesale Trade 4.4

By sectors, the productivity of the real estate, administrative
& support services, food & beverage services, wholesale
trade, retail trade and professional services sectors rose
Information & Comms
in the fourth quarter. On the other hand, the productivity of -0.8
the accommodation, construction, manufacturing, finance Overall Productivity -0.8
& insurance, information & communications, transportation Manufacturing -2.2
& storage and other services sectors declined. Finance & Insurance -2.7
Construction -7.2
Collectively, the productivity of outward-oriented sectors Accommodation -8.7
fell by 4.3 per cent in the fourth quarter, while that of -15 -10 -5 0 5 10 15 20
domestically-oriented sectors rose by 0.5 per cent over Per Cent
the same period.4 For the full year of 2022, real value-added per actual hour
worked declined by 0.8 per cent, a reversal from the 6.7
per cent increase in 2021 (Exhibit 2.4). While growth in the
Exhibit 2.4: Changes in Value-Added per Actual Hour real value-added per actual hour worked for the overall
Worked for the Overall Economy economy in 2022 was supported by double-digit productivity
gains in the real estate and food & beverage services
Per Cent
8
sectors, it was weighed down by productivity declines in
the accommodation, construction, finance & insurance,
manufacturing and information & communications sectors
6 (Exhibit 2.5).
4
Real Value-Added per Worker
2
Real value-added per worker fell by 4.9 per cent in the
fourth quarter, extending the 2.3 per cent contraction in
0 the preceding quarter.
For 2022 as a whole, real value-added per worker declined by

-2
2018 2019 2020 2021 2022 1.1 per cent, in contrast to the 10.8 per cent growth in 2021.
The weaker performance of real value-added per worker

compared to real value-added per actual hour worked in
2022 was because of a slight decline in the average number
of actual hours worked per worker during the year.
4 Outward-oriented sectors refer to manufacturing, wholesale trade, transportation & storage, accommodation, information & communications, finance & insurance
and professional services. Domestically-oriented sectors refer to construction, retail trade, food & beverage services, real estate, administrative & support services
and other services industries.
INCOME FROM WORK

Reflecting the recovery of the labour market in 2022, both
nominal and real gross monthly income of resident workers
increased. Specifically, nominal median gross monthly
income (including employer CPF contributions) of full-time
employed residents grew by 8.3 per cent to reach $5,070 in
2022, extending the growth of 3.2 per cent in 2021.
After adjusting for inflation5, real median income increased

by 2.0 per cent in 2022. Lower-income earners also saw
growth in their incomes after taking inflation into account,
with real income at the 20th percentile rising by 4.7 per
cent in 2022.
Over the last five years (i.e., June 2017 to June 2022), real
median income rose by 9.4 per cent cumulatively, or 1.8
per cent per annum (Exhibit 2.6). During this period, real
income growth at the 20th percentile exhibited stronger
growth (15.4 per cent cumulatively, or 2.9 pe r cent per
annum), thus narrowing the income gap with the median
income earner.
Exhibit 2.6: Annualised Change in Real Gross Monthly Income

from Work of Full-Time Employed Residents, 2017-2022
Per Cent Per Annum
3 2.9
2 1.8
0
20th Percentile Median
5 The Consumer Price Index (CPI) for all items rose by 6.1 per cent in 2022.
CHAPTER COSTS,
3 INVESTMENTS
AND PRICES
Chapter 3
COSTS, INVESTMENTS
AND PRICES
OVERALL UNIT LABOUR COST WITHIN THE
(Year-On-Year Growth) MANUFACTURING SECTOR
10 Overall ULC
8.5%
5
-5
9.6% 9.6%
in 2022 in 2022
-10
2020 2021 2022 Unit Labour Cost Unit Business Cost
INVESTMENT CLUSTERS THAT ATTRACTED THE HIGHEST FIXED

COMMITMENTS ASSET INVESTMENT COMMITMENTS
IN 2022
Electronics Services Clusters Chemicals
CLUSTERS THAT ATTRACTED THE HIGHEST TOTAL

BUSINESS EXPENDITURE COMMITMENTS
Fixed Asset Total Business

Investment Expenditure
Commitments Commitments
$22.5 $6.2 Headquarters & Infocommunications & Research &
billion billion Professional Services Media Development
CPI-ALL ITEMS INFLATION IN 2022, THE INCREASE IN CPI WAS MAINLY DUE
8
TO THE INCREASE IN PRICES OF
6.1%
6 Food
Transport Housing & Utilities
4
2.3%
2
0 3.0% 1.3% 1.1%

-0.2% point contribution point contribution point contribution
-2
2020 2021 2022

Chapter 3: Costs, Investments and Prices 23
OVERVIEW
Overall ULC for the economy rose by 9.3 per cent year-on-year in the fourth quarter, extending the increase of
7.7 per cent in the preceding quarter. For the whole of 2022, overall ULC rose by 8.5 per cent.
Total investment commitments attracted by EDB remained healthy in 2022. The manufacturing sector garnered
a larger amount of commitments in terms of fixed asset investments (FAI), while the services sector attracted
a larger amount of total business expenditure (TBE) commitments. By clusters, the electronics and chemicals
clusters within the manufacturing sector were the biggest contributors to FAI commitments, while the headquarters
& professional services cluster within the services sector contributed the most to TBE commitments.
The Consumer Price Index-All Items (CPI-All Items) rose by 6.6 per cent year-on-year in the fourth quarter,
moderating from the 7.3 per cent increase in the previous quarter. For 2022 as a whole, CPI-All Items inflation
came in at 6.1 per cent, higher than the 2.3 per cent recorded in 2021.
Producer prices, as measured by the domestic supply price index (DSPI), the Singapore manufactured products
price index (SMPPI) as well as the import and export price indices, all rose on a year-on-year basis in the fourth
quarter. For the whole of 2022, the DSPI, SMPPI as well as the import and export price indices increased by 18.6
per cent, 14.9 per cent, 14.4 per cent and 15.9 per cent respectively.
COSTS By broad sectors, the construction sector registered the

largest ULC increase (11.1 per cent) in the fourth quarter,
Overall ULC for the economy rose by 9.3 per cent year-on- although this was a moderation from the 14.0 per cent
year in the fourth quarter, extending the increase of 7.7 increase seen in the previous quarter. Similarly, the ULC
per cent in the previous quarter (Exhibit 3.1). The pickup for the manufacturing sector rose by 10.3 per cent in the
in overall ULC during the quarter came on the back of an fourth quarter, following the 10.0 per cent increase in the
increase in total labour cost per worker and a decrease third quarter. For both the manufacturing and construction
in labour productivity (as measured by real value-added sectors, the increase in their respective ULCs was due to
per worker). a fall in their productivity, which was partially offset by a
decline in total labour cost per worker in the sector.
Meanwhile, the ULC of services producing industries went

Exhibit 3.1: Changes in Unit Labour Cost in 4Q 2022
up by 7.8 per cent in the fourth quarter, extending the 6.0
per cent increase in the previous quarter. Most services
Finance & Insurance 16.1
sectors saw a pickup in their ULCs, with the finance &
insurance sector registering the largest increase (16.1
Accommodation 12.7
per cent). The latter was on account of an increase in total
Information & Comms 11.2 labour cost per worker and a decline in labour productivity
Construction 11.1 within the sector.
Manufacturing 10.3
Overall Ecomony 9.3 For the whole of 2022, the overall ULC rose at a faster pace
Retail Trade 8.5 of 8.5 per cent, compared to the 4.9 per cent increase in
Professional Services 7.9 2021. The rise in the overall ULC was due to the combined
effect of an increase in total labour cost per worker and a
decline in labour productivity in the economy.
Wholesale Trade 6.4
Administrative & Support -4.4
Real Estate -11.0

-20 -10 0 10 20
Per Cent
Manufacturing unit business cost (UBC) rose by 11.1 per INVESTMENT COMMITMENTS
cent year-on-year in the fourth quarter, extending the
10.3 per cent increase in the previous quarter (Exhibit EDB attracted healthy levels of investment commitments
3.2). The increase in manufacturing UBC came on the in 2022. For the full year, FAI and TBE commitments came
back of a pickup in unit services costs (11.6 per cent), in at $22.5 billion and $6.2 billion respectively.
manufacturing ULC (10.3 per cent) and unit non-labour
production taxes (11.5 per cent). For 2022 as a whole, the In terms of FAI, the largest contribution came from the
manufacturing UBC climbed by 9.6 per cent, faster than manufacturing sector, which garnered $17.4 billion in
the 0.1 per cent increase in 2021. commitments. Within manufacturing, the electronics
cluster attracted the largest amount of FAI commitments,
Exhibit 3.2: Changes in Unit Business Cost for Manufacturing at $15.0 billion, followed by the chemicals cluster, at $862
million. Within the services sector, the infocommunications
Per Cent
& media and research & development clusters contributed
15 the most to total FAI commitments, with $2.2 billion and
$1.4 billion respectively (Exhibit 3.4).
10 Exhibit 3.4: Fixed Asset Investments by Industry Clusters

in 2022
5 Electronics
66.7%
Others
-5 6.7%
IV I II III IV
2021 2022 Chemicals
3.8%
Services Clusters
Singapore’s relative unit labour cost (RULC) for 22.8%
manufacturing – a measure of Singapore’s competitiveness
against 16 economies1 – rose in 2022 (i.e., less competitive)
as compared to 2021 (Exhibit 3.3). The deterioration in Investors from the United States were the largest source of
Singapore’s RULC was mainly on account of an increase in FAI commitments, with $11.4 billion (50.6 per cent). They
Singapore’s manufacturing ULC and a stronger Singapore were followed by investors from Europe who contributed
dollar. about $4.8 billion of FAI commitments (21.2 per cent).
Exhibit 3.3: Singapore’s Relative Unit Labour Cost in For TBE, the services sector attracted the highest amount
Manufacturing Against Selected 16 Economies1 of commitments, at $5.0 billion. This was driven by the
headquarters & professional services cluster, which
Index
110 garnered $2.9 billion in TBE commitments, followed by
the infocommunications & media cluster, with $1.4 billion.
Among the manufacturing clusters, the electronics cluster
100
contributed the highest amount of TBE commitments, at
$533 million (Exhibit 3.5).
90
80
70
60
50
2015 2016 2017 2018 2019 2020 2021 2022
1 The 16 economies are Australia, China, France, Germany, Hong Kong, India, Indonesia, Japan, Malaysia, Netherlands, South Korea, Taiwan, Thailand, the United
Kingdom, the United States and Vietnam.
Exhibit 3.5: Total Business Expenditure by Industry Clusters For 2022 as a whole, CPI-All Items rose by 6.1 per cent,
in 2022 faster than the 2.3 per cent increase in 2021.
Others Headquarters Price increases in the following CPI categories contributed

12.5% & Professional
Services positively to CPI-All Items inflation in 2022 (Exhibit 3.7).
46.6%
Transport costs climbed by 16.4 per cent due to an increase
in the costs of cars, petrol and airfares.3 Food prices rose by
Electronics 5.3 per cent on the back of an increase in the costs of food
8.6%
services like hawker food and restaurant meals, as well
as non-cooked food items such as meat, fish & seafood,
and bread & cereals. Housing & utilities costs increased
Research &
Development by 5.2 per cent because of a rise in accommodation and
10.1% electricity costs. Recreation & culture prices rose by 4.3
Infocommunications per cent as a result of the higher costs of holiday travel4
& Media and recreational & cultural services. Clothing & footwear
22.2%
prices picked up by 2.8 per cent due to more expensive
ready-made garments and footwear. Healthcare costs
increased by 2.2 per cent on account of the higher costs of
Investors from the others region2 accounted for most of outpatient and hospital services. Education costs rose by
the TBE commitments, at $2.7 billion (44.1 per cent). 2.1 per cent due to higher fees at commercial institutions
and universities. Prices of household durables & services
When these projects are fully implemented, they are went up by 2.0 per cent as the prices of household durables
expected to generate $20.6 billion of value-added per and domestic & household services increased. Prices of
annum and create more than 17,000 jobs in the coming miscellaneous goods & services edged up by 0.5 per cent
years. on the back of a rise in the cost of personal care items.
Exhibit 3.7: Changes in CPI by Category in 2022

CONSUMER PRICE INDEX
Transport 16.4
Singapore’s CPI-All Items rose by 6.6 per cent on a year-
Food
on-year basis in the fourth quarter, moderating from the 5.3
7.3 per cent increase in the previous quarter (Exhibit 3.6). Housing & Utilities 5.2
On a quarter-on-quarter seasonally-adjusted basis, CPI-
Recreation & Culture 4.3
All Items inflation came in at 0.9 per cent, down from the
1.8 per cent in the previous quarter. Clothing & Footwear 2.8
Health Care 2.2

Exhibit 3.6: Changes in Overall CPI
Education 2.1
Per Cent
Household Durables
8 2.0
& Services
Misc Goods & Services 0.5
YOY Growth
Communication -1.2
6
-5 0 5 10 15 20
Per Cent
4
By contrast, communication costs fell by 1.2 per cent
on account of a drop in the prices of telecommunication
QOQ Growth (SA)
services.
2
0
IV I II III IV
2021 2022
2 Others refers to countries except for Singapore, Europe, Japan and the United States.
3 As overseas travel was limited in April 2020 – December 2022, a portion of the CPI for airfares was imputed using the overall change in CPI-All Items. With more
flights resuming and prices becoming available, actual airfares are being progressively incorporated into the CPI.
4 Similarly, as overseas travel was limited, the CPI for holiday expenses was imputed using the overall change in CPI-All Items. However, with the easing of travel
restrictions, actual holiday expenses are increasingly being incorporated into the CPI.
PRODUCER PRICE INFLATION Exhibit 3.9: Changes in Import and Export Price Indices
Per Cent
Producer prices – as measured by the DSPI, SMPPI, and 30
import and export price indices – all rose on a year-on-
year basis in the fourth quarter (Exhibits 3.8 and 3.9). The
increases seen during the quarter came on the back of Export Price Index
a rise in the prices of integrated circuits and diesel fuel.

20
For the full year, the DSPI and SMPPI climbed by 18.6 per Import Price Index
cent and 14.9 per cent respectively, while the import and
export price indices rose by 14.4 per cent and 15.9 per
cent respectively. The higher prices of integrated circuits 10
and diesel fuel also contributed to the increase in these
producer price indices for the year.
Exhibit 3.8: Changes in Domestic Supply Price and Singapore
Manufactured Products Price Indices 0
IV I II III IV
Per Cent 2021 2022
30
Domestic Supply
Price Index
20
Singapore Manufactured
Products Price Index
10
0
IV I II III IV
2021 2022
Box Article 3.1
BUSINESS COST CONDITIONS IN

SINGAPORE’S MANUFACTURING AND
SERVICES SECTORS
OVERVIEW
Unit business cost in both the
manufacturing and overall
services sector rose in 2022.
DEFINITION OF UBC
Total Business Cost 9.6% 8.8%

UBC = in 2022 in 2022*
Gross Real Value-Added
UBC for Manufacturing UBC for Services
*Refers to first three quarters of 2022
KEY DRIVERS
The increase in manufacturing UBC in 2022 was The increase in services UBC in 2022 came on the
mainly on account of increases in manufacturing back of an increase in non-labour cost and unit
unit labour cost as well as the higher costs of labour cost.
work given out and utilities.
CONTRIBUTION TO MANUFACTURING UBC CONTRIBUTION TO SERVICES UBC
IN 2022 IN 2022
+2.4% +2.2%
point point
+7.0% +1.8%
Labour Cost Work Given Out point point
Non-Labour Cost Labour Cost

+2.0%
point
Utilities
OUTLOOK
Looking ahead, the overall ULC for the economy is likely to continue to rise in 2023, albeit at a more moderate
pace as the growth in renumeration per worker is likely to soften amidst global economic headwinds and the
slowdown in the domestic economy. At the same time, the costs of utilities, fuel and transportation are
expected to ease but remain elevated, reflecting the outlook for global oil prices in 2023.
UNIT LABOUR COST UTILITIES COST

BOX 3.1: BUSINESS COST CONDITIONS IN SINGAPORE’S

MANUFACTURING AND SERVICES SECTORS
This box article highlights the latest trends in business costs for firms in Singapore’s manufacturing and services
sectors, as well as the outlook for key components of business costs in 2023.
(I) Unit Business Cost1 in the Manufacturing and Services Sectors
Unit business cost in both the manufacturing and overall services sector rose in 2022
In 2022, the unit business cost index for the manufacturing sector (UBCI) rose by 9.6 per cent (Exhibit 1). The main
contributors to the increase in UBCI were manufacturing unit labour cost (ULC), as well as the costs of work given
out and utilities, with their contributions collectively accounting for 6.6 percentage-points (pp) of the increase in the
UBCI. Meanwhile, other cost components such as non-labour production taxes2 (e.g., property, road and other indirect
taxes) and rental costs3 had a relatively small impact on the UBCI, in part due to their small shares in overall business
cost. (Please refer to the Annex for the business cost structure of firms in the manufacturing and services sectors.)
Exhibit 1: Contribution to the UBCI Change in 2022, by Key Cost Components
Contribution to yoy change, ppc

12
0
1Q22 2Q22 3Q22 4Q22 2022
ULC Work Given Out Others Royalties
Utilities Rental Unit Non-Labour Manufacturing UBC

Production Taxes
Source: Department of Statistics
Note: “Others” consists of sub-components such as the charges paid for transportation and freight, professional fees, advertising, commission and agency fees, sundry expenses, etc.
As for the overall services sector, its unit business cost index (UBC-Services Index)4 rose by 8.8 per cent in the first
three quarters of 2022 compared to the same period a year ago (Exhibit 2).5 This was due to an increase in non-labour
costs (+7.0pp contribution) and the services ULC (+1.8pp). In turn, the increase in non-labour costs could be attributed
to higher freight & transport charges and fuel costs caused by a sharp rise in oil prices following the onset of the
Russia-Ukraine war. Meanwhile, other cost components such as rental costs had a relatively small impact on the
UBC-Services Index. In particular, while the rental for office space rose in 2022, there was a fall in rental for retail
space over the same period.6
1 Unit business cost measures the costs incurred to produce one unit of output. Only operating expenses (excluding materials costs and depreciation) are included
in business costs. This is the definition adopted by the Department of Statistics (DOS) in its computation of the Unit Business Cost for Manufacturing. See DOS’s
Information Paper, “Methodological Review on the Unit Business Cost Index for Manufacturing Industry (Base Year 2010=100)”, at https://www.singstat.gov.sg/-/
media/files/publications/economy/ip-e38.pdf.
2 Labour-related taxes on production (e.g., foreign worker levy) are classified under labour cost. Taxes on income (e.g., corporate income tax) are not included in
business cost.
3 Industrial rentals rose by 6.9 per cent in 2022 amidst inflationary pressures, larger than the 2.0 per cent increase in 2021.
4 The UBC-Services Index is estimated by MAS to assess cost conditions in the services sector. It is a composite index of proxy cost indicators for each component
of business costs where available, combined using weights estimated from expenditure data in DOS’s Services Survey Series 2019: The Services Sector, as well as
the 2019 Input-Output tables.
5 Latest available UBC-Services Index is up to the third quarter of 2022.
6 Rentals of office space rose by 11.7 per cent in 2022, supported by an increase in the demand for office space as the economy continued to recover and workplace
safe management measures were lifted. Meanwhile, rentals of retail space fell by 2.4 per cent in 2022, moderating from the 6.8 per cent decline in 2021 as the
relaxation of domestic and travel restrictions led to an increase in retail spending and demand for retail space.
Exhibit 2: Contribution to UBC-Services Index Changes by Cost Components
Contribution to yoy change, ppc
12
0
1Q22 2Q22 3Q22 2022
ULC Non-Labour Costs UBC - Services Index
Source: Monetary Authority of Singapore

Notes: (1) The UBC-Services Index for 2022 refers to the average of the index for the first three quarters; (2) Detailed cost component breakdown of the UBC-Services Index
is not available; (3) Non-labour costs include air & sea freight costs, cargo handling costs and warehousing & storage costs.
(II) Latest Trends and Outlook for Key Cost Components
The ULC for the overall economy increased in 2022 at a faster pace than in 2021
The ULC for the overall economy rose by 8.5 per cent in 2022, faster than the 4.9 per cent increase in 2021.7 With this
increase, the ULC for the overall economy in 2022 was 4.3 per cent higher than its pre-COVID (2019) level.
The increase in the overall ULC in 2022 was due to a rise in total labour cost8 (TLC) per worker (7.8 per cent) and a
slight decline in labour productivity9 (-0.6 per cent) (Exhibit 3). In turn, the increase in TLC per worker was driven by a
pickup in remuneration per worker, and a tapering of the wage subsidies that were provided by the Government during
the pandemic (e.g., Jobs Support Scheme).10 Specifically, the increase in remuneration per worker and fall in wage
subsidies per worker contributed 4.5pp and 3.2pp to the rise in TLC per worker in 2022 respectively.
At the sectoral level, all sectors except for the real estate sector experienced an increase in their ULCs in 2022 (Exhibit
4). The ULCs for the construction (11.5 per cent) and manufacturing (9.6 per cent) sectors increased on the back of a
rise in TLC per worker alongside a decline in labour productivity.
Meanwhile, among the services sectors, the accommodation (26.5 per cent) and food & beverage services (15.1 per
cent) sectors registered the largest increases in their ULCs. For the accommodation sector, the increase in its ULC
was due to the combined effect of an increase in TLC per worker and a fall in labour productivity. On the other hand,
the increase in ULC for the food & beverage services sector was due to a sharp increase in TLC per worker which
outpaced gains in labour productivity.
For 2023, the ULC for the overall economy is likely to continue to rise, albeit at a more moderate pace as compared to
2022, as the growth in renumeration per worker is likely to soften amidst global economic headwinds and a slowdown
in the domestic economy.
7 A change in the ULC can be approximately decomposed as the change in total labour cost per worker minus the change in labour productivity (proxied by gross real
value-added per worker). The approximation holds better when the changes are small.
8 TLC comprises remuneration, wage subsidies and other labour-related costs, which include the skills development levy, foreign worker levy, and recruitment and
net training costs. An example of a wage subsidy provided to firms is the Jobs Support Scheme (JSS), which was extended in 2021 to help firms affected by the
COVID-19 pandemic retain their local employees. Specifically, the JSS provided wage support of up to 10 to 50 per cent (between 16 May 2021 and 19 December
2021) of the first $4,600 of gross monthly wages paid to local employees by eligible firms. The final payout for JSS based on wages from 1 November to 19 December
was disbursed on 31 March 2022.
9 Labour productivity in this decomposition exercise is proxied by real gross value-added per worker.
10 In a given year, wage subsidies provided by the Government would reduce the TLC per worker. However, the tapering of wage subsidies from one year to the next
would contribute positively to the changes in TLC per worker.
Exhibit 3: Decomposition of ULC Growth for Overall Exhibit 4: ULC Change by Sectors, 2022
Economy, 2022
Accommodation 26.5
ULC 8.5%
TLC per worker 7.8%
Construction 11.5
Information & Communications 10.6
Remuneration per worker +4.5pp
Finance & Insurance Services 9.9
Manufacturing 9.6
FWL per worker +0.1pp
Services Producing Industries 7.5
Wage subsidies per worker +3.2pp
Administrative & Support Services 5.5
Retail Trade 5.4
Other labour costs -
Wholesale Trade 4.8
Gross real labour productivity -0.6%
Real Estate -3.2
-10 0 10 20 30
* Measured as real gross value-added per worker. Per Cent
Source: MTI Staff estimates using data from the Department of Statistics and Ministry of Manpower
Costs of utilities, fuel and transportation are likely to ease but remain elevated in 2023
The cost of utilities borne by firms is closely linked to electricity prices,11 which are in turn strongly influenced by
movements in global oil prices.12 Oil prices also contribute to business costs through fuel and transportation costs.
In 2022, the average wholesale electricity price rose by 49 per cent on the back of a spike in global oil prices and a
corresponding pickup in natural gas prices.13 The price hikes for oil and natural gas could be attributed in large part
to tight global supply conditions that were exacerbated by the Russia-Ukraine war. In 4Q22, however, the average
wholesale electricity prices fell on a year-on-year basis due to the high base a year ago arising from disruptions to
the supply of Piped Natural Gas (PNG) to Singapore (Exhibit 5).
Looking ahead, while global oil prices have eased from the peaks in 2022 amidst concerns over the slowdown in the
global economy, they are projected to remain elevated given continued tight supply conditions. For 2023 as a whole, the
US Energy Information Administration has projected that global oil prices will average US$84 per barrel (/bbl)14, lower
than the 2022 average of US$101/bbl but higher than the 5-year annual average of US$60/bbl between 2017 and 2021.
In turn, elevated oil prices will keep the domestic costs of utilities, fuel and transportation at elevated levels in 2023.
11 Electricity cost is a component of utilities cost, which forms a relatively small share of total business costs. For example, utilities cost accounts for 2.5 per cent to
3.1 per cent of business costs for SMEs and non-SMEs in the manufacturing sector respectively (refer to the Annex for details). Similarly, utilities cost is a relatively
small cost component for firms in the services sectors, accounting for less than 2 per cent of the business costs of firms in most sectors.
12 Around 95 per cent of our electricity is generated from natural gas, the price of which is indexed to oil prices. This is a common market practice in Asia.
13 This is based on the average half-hourly Uniform Singapore Energy Price (USEP), which is a proxy for average wholesale energy prices in the National Electricity
Market of Singapore.
14 EIA Short-Term Energy Outlook Report, February 2023.
Exhibit 5: Global Oil Prices and Uniform Singapore Energy Prices, 1Q22 – 4Q22
Per Cent change, yoy
300
200
100
-100
1Q22 2Q22 3Q22 4Q22
UK Brent USEP ($/MWh)
Source: International Monetary Fund, CEIC, Energy Market Company
Conclusion
In 2022, the UBC for the manufacturing sector rose, in large part due to the increase in manufacturing ULC as well
as the higher costs of work given out and utilities. Similarly, the UBC for the overall services sector rose in the first
three quarters of 2022 on account of an increase in non-labour costs and the services ULC.
Looking ahead, the overall ULC for the economy is likely to continue to rise in 2023, albeit at a more moderate pace as
the growth in renumeration per worker is likely to soften amidst global economic headwinds and the slowdown in the
domestic economy. At the same time, the costs of utilities, fuel and transportation are expected to ease but remain
elevated, reflecting the outlook for global oil prices in 2023.
Contributed by:
Ms Tan Yen Ling

Economist
Economics Division
REFERENCES
Singapore Department of Statistics (2014), “Methodological Review on the Unit Business Cost Index for Manufacturing
Industry (Base Year 2010=100)” November. https://www.singstat.gov.sg/-/media/files/publications/economy/ip-e38.pdf.
U.S. Energy Information Administration (2023), “Short-Term Energy Outlook (STEO)” February. https://www.eia.gov/
outlooks/steo/.
ANNEX: BUSINESS COST STRUCTURE OF MANUFACTURING AND SERVICES SECTORS
Manufacturing Sector
In the manufacturing sector, labour cost, work given out and “others” constitute the largest components of business
costs. These three components collectively account for around 84 per cent of the business costs of small- and medium-
sized enterprises (SMEs) and around 73 per cent of the business costs of non-SMEs in the sector.
The remaining services cost components, including utilities, fuel, rental of building/premises and charges paid to other
firms for inland transportation and ocean/air/other freight, make up a smaller share of business costs, at around 26
per cent for non-SMEs and 15 per cent for SMEs. Non-labour production taxes, which include property, road and other
indirect taxes, account for around 0.6 per cent and 0.5 per cent of the business costs of SMEs and non-SMEs respectively.
Details of the business cost structure of SMEs and non-SMEs in the various manufacturing clusters are in Exhibit A1.
Services Sector
Labour cost is a major cost component for firms in the services sectors, with its share of business costs ranging from
around 6 per cent for firms in the transportation & storage sector, to around 38 per cent or more for firms in labour-
intensive sectors such as the food & beverage services, accommodation and retail trade sectors. Across all services
sectors, except for the retail trade and transportation & storage sectors, the labour cost share of business costs is
larger for SMEs than for non-SMEs.
On the other hand, utilities cost is a relatively small cost component for services firms, accounting for less than 2 per
cent of the business costs of firms in most services sectors. Key exceptions are firms in the accommodation and food
& beverage services sectors, where utilities cost constitutes around 6 per cent or less of their business costs. Similarly,
rental cost accounts for a small share of the business costs of firms in most services sectors. Key exceptions include
the retail trade and food & beverage services sectors, where the rental cost share of business costs for SMEs is 31
per cent and 26 per cent respectively.
Like in the manufacturing sector, non-labour production taxes account for less than 1 per cent of the business costs
of firms in most services sectors. Even for the retail trade, accommodation and real estate, professional services &
administrative & support services sectors, where the share of non-labour production taxes is the highest, it is relatively
small, at around 3 per cent or less.
Details of the business cost structure of SMEs and non-SMEs in the various services sectors are in Exhibit A2.
Exhibit A1: Business Cost Structure of the Manufacturing Sector by Firm Size, 2021
Biomedical Precision Transport General
Total Electronics Chemicals
Manufacturing Engineering Engineering Manufacturing
Non-SMEs SMEs Non-SMEs SMEs Non-SMEs SMEs Non-SMEs SMEs Non-SMEs SMEs Non-SMEs SMEs Non-SMEs SMEs
Labour Cost 18.2 32.1 11.5 8.6 15.4 28.1 25.4 13.7 29.8 49.2 34.9 50.3 37.1 47.5
Services Cost 81.3 67.3 88.3 90.9 83.6 71.0 74.2 85.9 69.8 50.1 63.2 49.0 62.3 51.8
Work given out 20.1 20.8 25.8 44.2 6.6 3.1 10.5 16.0 11.0 15.8 36.9 17.8 7.4 12.5
Royalty payments 13.5 5.2 13.8 5.4 5.6 4.5 32.0 20.7 22.2 1.5 1.7 2.8 3.9 1.1
Utilities 3.1 2.5 2.3 0.4 7.1 9.4 1.4 0.7 1.5 2.1 1.8 1.4 6.8 2.8
Fuel 6.0 1.1 0.9 0.1 32.0 5.4 0.4 0.2 0.1 0.4 0.3 0.4 3.5 1.5
Rental of building/
0.3 1.8 0.1 0.2 0.3 1.1 0.8 0.4 0.6 1.8 0.5 2.7 1.4 4.6
premises
Charges paid to other
firms for inland
3.1 4.9 1.7 1.4 6.2 14.8 4.0 8.0 4.8 3.0 1.6 1.4 5.6 4.9
transportation and
ocean/ air/ other freight
Others 35.2 31.1 43.6 39.4 25.9 32.7 25.2 39.9 29.5 25.6 20.4 22.5 33.8 24.3
Non-Labour Production
0.5 0.6 0.2 0.4 1.0 0.9 0.3 0.4 0.4 0.7 1.9 0.7 0.6 0.7
Taxes
Source: Economic Development Board
Note: SMEs refer to enterprises with operating receipts of not more than $100 million or employment of not more than 200 workers. Non-SMEs refer to enterprises with operating receipts of more than $100 million and employment
of more than 200 workers. “Others” consists of sub-components such as professional fees, advertising, commission and agency fees, sundry expenses, etc.
Chapter 3: Costs, Investments and Prices
33
Exhibit A2: Business Cost Structure of the Services Sectors by Firm Size, 2021
34
Real Estate,
Professional
Food &
Wholesale Transportation Information & Finance & Services and
Retail Trade Beverage
Trade & Storage Communications Insurance Administrative
Accommodation^ Services
& Support
Services
Non- Non- Non- Non- Non- Non- Non-
SMEs SMEs SMEs SMEs SMEs SMEs SMEs
SMEs SMEs SMEs SMEs SMEs SMEs SMEs
Labour Cost 16.1 17.0 42.1 36.8 46.4 45.0 46.5 12.9 3.9 13.3 21.3 12.2 15.5 32.1 34.8
Services Cost 83.7 82.3 56.6 62.4 50.6 54.7 53.2 86.7 96.0 86.4 78.2 87.6 84.2 66.1 63.0
Economic Survey of Singapore 2022
Utilities 0.3 0.2 2.8 1.4 6.4 3.9 4.8 0.5 0.1 0.5 0.6 - 0.1 0.4 0.9
Freight & Transport 16.7 39.7 4.7 2.6 - 2.6 1.0 55.3 71.8 0.2 0.7 - - 1.1 1.5
Financial Services 3.0 1.9 1.9 2.5 1.8 0.8 1.4 0.4 0.3 0.5 1.9 5.0 5.8 0.1 1.0
Communications 0.5 0.3 0.3 0.8 0.7 0.2 0.5 0.4 0.3 2.8 8.1 0.2 0.3 0.2 0.4
Renting of Premises 2.2 4.9 24.4 30.5 13.3 20.8 26.1 0.8 1.2 1.1 3.2 0.8 1.3 1.7 4.3
Professional Services 7.9 4.2 1.9 2.4 2.5 1.1 1.5 1.0 0.7 12.7 12.1 3.2 4.7 10.1 6.8
Other Services 53.1 31.2 20.6 22.2 25.9 25.3 17.9 28.2 21.5 68.6 51.5 78.4 72.2 52.5 48.0
Advertising &
3.9 4.3 4.3 6.3 2.6 3.8 2.2 0.2 0.3 14.6 14.0 1.8 0.8 0.5 4.1
Entertainment
Admin & Management
12.5 7.1 1.9 3.0 6.2 3.2 3.3 3.2 1.5 3.4 11.2 4.6 11.9 4.7 11.4
Fees
Contract labour & work
15.2 2.4 0.8 1.3 1.8 1.4 2.1 1.6 0.7 4.2 7.2 0.3 0.3 25.9 9.6
given out
Commission 2.6 5.7 1.2 3.5 1.8 1.1 2.0 1.5 2.0 2.0 1.9 3.9 8.3 1.1 5.5
Royalties 13.3 3.2 1.2 0.7 0.7 6.8 1.8 - - 40.6 4.9 0.1 0.2 0.4 0.8
Maintenance & repairs 0.9 0.6 3.7 1.8 5.5 5.3 2.4 3.2 1.1 0.5 1.0 0.6 0.3 1.8 3.4
Fuel - 0.8 0.1 0.1 - 0.1 - 13.1 12.4 - - - - - 0.3
Others 4.7 7.1 7.4 5.4 7.3 3.6 4.0 5.4 3.5 3.4 11.4 67.1 50.3 18.0 12.9
Non-Labour Production
0.3 0.7 1.2 0.8 3.0 0.3 0.3 0.3 0.1 0.3 0.5 0.2 0.4 1.8 2.2
Taxes
Source: Department of Statistics and Monetary Authority of Singapore
Notes:
1. SMEs refer to enterprises with operating receipts of not more than $100 million or employment of not more than 200 workers. Non-SMEs refer to enterprises with operating receipts of more than $100 million and employment
of more than 200 workers.
2. “-“ refers to nil or negligible.
3. ^The breakdown of SMEs and non-SMEs for the accommodation sector is not available due to data suppression as most firms in the accommodation sector in 2021 would be considered SMEs by definition as a result of the effects
of the COVID-19 pandemic on the activity of the sector.
CHAPTER
INTERNATIONAL
4 TRADE
Image courtesy of PSA Singapore
Chapter 4
INTERNATIONAL
TRADE
TOTAL MERCHANDISE TRADE TOTAL SERVICES TRADE
AMOUNTED TO... AMOUNTED TO...
$655 billion $357 billion
Merchandise Services Imports
Imports
$1,365 $758
billion $199 billion
billion
in 2022 Non-Oil in 2022
Domestic Exports
$380 billion $130 billion $402 billion

Re-exports Oil Domestic Exports Services Exports
GROWTH IN MERCHANDISE TRADE GROWTH IN SERVICES TRADE

30
30 Merchandise Imports
Services Exports
20.1% 20 12.1%
20 Total Services Trade
Total Merchandise Trade
10 17.7% 10 10.8%
Merchandise Exports Services Imports
15.6% 9.3%
0 0
-10 -10
2020 2021 2022 2020 2021 2022
COMPONENTS OF MERCHANDISE EXPORTS THE INCREASE IN

(Year-On-Year Growth) SERVICES EXPORTS WAS LED BY...
+52.4% +13.5% +3.0% +4.5% +3.0%
point contribution point contribution
Oil Domestic Re-exports Non-Oil Transport Services Travel Services

Exports Domestic Exports
Chapter 4: International Trade 39
OVERVIEW
Singapore’s total merchandise trade declined by 1.0 per cent year-on-year in the fourth quarter of 2022, a
reversal from the 25.7 per cent growth in the previous quarter. At the same time, total services trade increased
by 7.0 per cent year-on-year, extending the 12.5 per cent growth in the third quarter.
For the whole of 2022, Singapore’s total merchandise trade surged by 17.7 per cent to $1.4 trillion, from $1.2
trillion in 2021. Oil trade expanded by 47.5 per cent amidst higher oil prices compared to a year ago, while non-
oil trade grew by 11.9 per cent. Merchandise exports and imports increased by 15.6 per cent and 20.1 per cent
respectively.
Total services trade rose robustly by 10.8 per cent to $758 billion in 2022, from $684 billion in 2021. Services
exports and imports increased by 12.1 per cent and 9.3 per cent respectively in 2022.
MERCHANDISE TRADE For the whole of 2022, total merchandise exports rose
by 15.6 per cent, extending the 19.1 per cent increase
Merchandise Exports recorded in 2021.
Total merchandise exports fell by 2.3 per cent year-on-

year in the fourth quarter, a sharp reversal from the 23.4 Non-Oil Domestic Exports
per cent increase in the previous quarter (Exhibit 4.1). The
decline was due to both domestic exports and re-exports. Non-oil domestic exports (NODX) declined by 14.0 per cent
Domestic exports dipped by 2.1 per cent, a pullback from year-on-year in the fourth quarter, a reversal from the 7.1
the 27.9 per cent increase in the third quarter. Meanwhile, per cent expansion in the preceding quarter (Exhibit 4.2).
re-exports declined by 2.4 per cent, reversing from the The plunge in NODX was due to a drop in both electronics
19.8 per cent increase in the previous quarter. and non-electronics NODX.
Exhibit 4.1: Growth Rates of Total Merchandise Trade, Exhibit 4.2: Changes in Domestic Exports
Merchandise Exports and Merchandise Imports
(In Nominal Terms) Per Cent
40
2022
2021 2022
I II III IV Domestic Exports
30
Total
Merchandise 19.7 20.8 28.0 25.7 -1.0 17.7 20
Trade
Merchandise 10
19.1 18.8 24.9 23.4 -2.3 15.6 Non-Oil Domestic Exports
Exports
0
Domestic
19.0 20.8 28.5 27.9 -2.1 18.2
Exports
-10
Oil 38.0 45.4 72.9 75.2 21.6 52.4
-20
IV I II III IV
Non-Oil 12.1 11.4 8.9 7.1 -14.0 3.0 2021 2022
Re-Exports 19.2 17.2 21.7 19.8 -2.4 13.5
Merchandise
20.4 23.1 31.6 28.1 0.5 20.1
Imports
Oil 49.4 50.7 66.7 58.8 8.2 43.9
Non-oil 15.3 17.4 23.5 21.2 -1.4 14.6

Electronics NODX declined by 15.9 per cent in the fourth NODX to the US expanded mainly because of a rise in the
quarter, extending the 1.8 per cent contraction in the exports of structures of ships & boats, non-monetary gold
previous quarter. The slump in electronics NODX was and specialised machinery. NODX to EU 27 rose on the
primarily due to a fall in the domestic exports of ICs, disk back of an increase in the exports of pharmaceuticals,
media products and parts of PCs. Non-electronics NODX specialised machinery and ICs. Meanwhile, ICs, specialised
declined by 13.4 per cent, reversing the 10.0 per cent machinery and electrical machinery contributed the most
growth in the previous quarter. The fall in non-electronics to the rise in NODX to Malaysia. On the other hand, NODX
NODX was due to lower domestic exports of non-monetary to China fell due to lower exports of non-monetary gold,
gold, pharmaceuticals and petrochemicals. specialised machinery and primary chemicals.
For the full year, NODX expanded by 3.0 per cent, extending
the 12.1 per cent growth in 2021. The growth in NODX was Oil Domestic Exports
supported by increased shipments of both electronics
(0.5 per cent) and non-electronics (3.8 per cent) products. Oil domestic exports increased by 21.6 per cent year-on-
year in the fourth quarter, extending the 75.2 per cent
The top 10 NODX markets accounted for 78.6 per cent of growth in the previous quarter. The growth in oil domestic
Singapore’s total NODX in 2022. Singapore’s NODX to all exports was led by higher exports to countries such as
the top 10 markets grew in 2022, except for China, Hong New Zealand and EU 27. This increase also partly reflected
Kong and Thailand (Exhibit 4.3). The biggest contributors higher oil prices compared to the same quarter a year
to the growth in NODX in 2022 were the US (18.6 per cent), ago. In volume terms, oil domestic exports expanded by
EU 27 (10.7 per cent) and Malaysia (11.7 per cent). 6.6 per cent, extending the 18.6 per cent increase in the
third quarter.
Exhibit 4.3: Growth Rates of Non-Oil Domestic Exports to
Top 10 Markets in 2022 For the full year, oil domestic exports posted robust growth
of 52.4 per cent, faster than the 38.0 per cent increase in
United States 18.6 2021. The increase in oil domestic exports was largely
Malaysia 11.7
on account of higher oil prices compared to a year ago.
By countries, it was driven mainly by higher exports to
EU 10.7
Malaysia, Indonesia and Australia. In volume terms, oil
Japan 10.7 domestic exports rose by 1.7 per cent in 2022, reversing
Indonesia 9.0 the 10.1 per cent decline in 2021.
Taiwan 6.3
South Korea 0.4

Non-Oil Re-Exports
Thailand -0.4
China -13.1
Non-oil re-exports (NORX) contracted by 2.4 per cent
year-on-year in the fourth quarter, deteriorating from the
Hong Kong -18.7
19.7 per cent increase in the preceding quarter (Exhibit
-25 -20 -15 -10 -5 0 5 10 15 20 25 4.4). The decline in NORX could be attributed to a fall
Per Cent in electronics NORX, as non-electronics NORX rose.
Electronics NORX decreased by 9.1 per cent, a reversal
from the 10.5 per cent growth in the third quarter, as the re-
exports of ICs, parts of PCs and PCs declined. Meanwhile,
non-electronics NORX grew by 6.0 per cent, slowing from
the 32.1 per cent increase in the preceding quarter. The
expansion in non-electronics NORX was mainly due to the
higher re-exports of specialised machinery, non-electric
engines & motor and electrical machinery.
Exhibit 4.4: Changes in Re-Exports Merchandise Imports

Per Cent
Non-oil imports registered a decline of 1.4 per cent
25
year-on-year in the fourth quarter, a sharp pullback
Re-Exports from the 21.2 per cent increase in the preceding quarter
20
(Exhibit 4.6). The fall in non-oil imports was due to a
Non-Oil Re-Exports decline in electronics imports (-6.0 per cent), while non-
15
electronics imports grew (2.0 per cent). In turn, the decline
in electronics imports was due to a drop in the imports
10
of IC, PCs and parts of PCs. Meanwhile, non-electronics
5
imports rose due to the imports of non-electric engines
& motors, jewellery and works of art.
0
Exhibit 4.6: Changes in Merchandise Imports
-5 Per Cent
IV I II III IV
2021 2022 100
Oil Imports
For the whole of 2022, NORX expanded by 13.4 per cent,
50
slower than the 19.2 per cent growth in 2021. The growth
in NORX was due to an increase in both electronics NORX Non-Oil Imports
(9.9 per cent) and non-electronics NORX (17.7 per cent).
0
NORX to all the top 10 NORX markets rose in 2022, except
for Hong Kong (Exhibit 4.5). NORX to Indonesia increased on
the back of a pickup in the re-exports of ICs, non-monetary
gold and civil engineering equipment parts. Meanwhile, -50
higher shipments of ICs, diodes & transistors and parts IV I II III IV
2021 2022
of PCs led to an increase in NORX to Malaysia.
Re-exports to the US grew on account of a rise in shipments Oil imports grew by 8.2 per cent year-on-year in the fourth
of electrical machinery, ICs and non-electric engines & quarter, slower than the 58.8 per cent increase in the
motors. preceding quarter. The increase in oil imports was due
partly to higher oil prices. In volume terms, oil imports
Exhibit 4.5: Growth Rates of Non-Oil Re-Exports to Top 10 expanded by 6.0 per cent, following the 21.9 per cent
Markets in 2022 increase in the third quarter.
Indonesia 28.6 For the full year of 2022, non-oil imports rose by 14.6 per
South Korea 20.9
cent, comparable to the 15.3 per cent growth in 2021.
Meanwhile, oil imports picked up by 43.9 per cent, extending
United States 20.1
the 49.4 per cent growth in 2021.
Malaysia 18.1
Taiwan 14.1
Japan 14.1
EU 13.0
China 6.9
Vietnam 5.0
Hong Kong -1.0

-5 0 5 10 15 20 25 30 35
Per Cent
Services Exports Services Imports

Services exports increased by 8.2 per cent year-on-year in Services imports rose by 5.7 per cent year-on-year in the
the fourth quarter, extending the 14.1 per cent expansion in fourth quarter, slower than the 10.6 per cent increase in the
the preceding quarter (Exhibit 4.7). The increase in services previous quarter. The expansion in services imports was
exports was primarily driven by a rise in the exports of on account of a rise in the imports of travel services (303
travel services (255 per cent), other business services (6.2 per cent), telecommunications, computer & information
per cent) and financial services (7.0 per cent). By contrast, services (4.6 per cent) and insurance services (3.3 per cent).
the exports of transport services, manufacturing services Conversely, the imports of other business services, charges
and personal, cultural & recreation services shrank by for the use of intellectual property and manufacturing
1.1 per cent, 15.6 per cent and 1.3 per cent respectively. services decreased by 1.1 per cent, 5.4 per cent and 6.4
per cent respectively.
For the full year, services exports grew by 12.1 per cent,
moderating from the 21.2 per cent increase in 2021. The For the whole of 2022, services imports expanded by 9.3
increase in services exports was attributable mainly to an per cent, following the 11.6 per cent increase in 2021.
expansion in the exports of transport services (13.0 per The growth in services imports was due to expansions
cent), travel services (195 per cent) and other business in the imports of travel services (279 per cent), transport
services (8.3 per cent). services (7.1 per cent), and other business services (3.9
per cent). These gains were partially offset by slight
Exhibit 4.7: Growth Rates of Total Services Trade, Services drops in payments arising from charges for the use of
Exports and Services Imports (In Nominal Terms) intellectual property (-0.6 per cent) and the imports of
financial services (-0.2 per cent).
2022
2021 2022
I II III IV
Total Services
16.5 10.7 13.1 12.5 7.0 10.8
Trade
Services
21.2 12.2 14.3 14.1 8.2 12.1
Exports
Services
11.6 9.2 11.8 10.6 5.7 9.3
Imports
CHAPTER
BALANCE OF
5 PAYMENTS
Chapter 5
BALANCE OF
PAYMENTS
Singapore’s balance of BALANCE OF PAYMENTS
payments came in at a deficit of COMPONENTS IN 2022
$157.4 billion at the end of 2022
150 300
$279.4 billion
$103.3 billion
100 $88.9 billion 250
50 200
0 150
$124.4 billion
-50 100
-100
50
-150
0
-$157.4 billion
-200 Current Capital and
2020 2021 2022 Account Financial Account
COMPONENTS OF COMPONENTS OF CAPITAL &

CURRENT ACCOUNT FINANCIAL ACCOUNT
$188.2 billion $45.0 billion -$124.2 billion $95.4 billion
Goods Services Direct Portfolio

Balance Balance Investment Investment
-$103.6 billion -$5.2 billion $3.1 billion $305.0 billion
Primary Secondary Financial Other

Income Balance Income Balance Derivatives Investment
Chapter 5: Balance of Payments 47
OVERVIEW
Singapore’s overall balance of payments recorded a smaller deficit of $10.7 billion in the fourth quarter of 2022,
compared to the deficit of $26.4 billion in the third quarter. For the whole of 2022, the overall balance of payments
registered a deficit of $157 billion, a reversal from the surplus of $88.9 billion in 2021. The reversal was mainly
due to a significant increase in net outflows from the capital and financial account. Singapore’s official foreign
reserves fell to $388 billion at the end of 2022.
CURRENT ACCOUNT Exhibit 5.2: Components of Current Account Balance
$ Billion
The current account surplus declined to $23.5 billion in 60 Goods Balance
the fourth quarter, from $32.7 billion in the third quarter
(Exhibit 5.1). For 2022 as a whole, the current account 40
surplus rose by $21.8 billion to $124 billion (19.3 per cent
of GDP). The increase in surplus was driven by larger
20
surpluses in the goods and services balances, which more Services Balance
than offset the larger primary and secondary income

0
deficits. Secondary Income Balance
-20 Primary Income Balance

Exhibit 5.1: Current Account Balance
$ Billion -40
IV I II III IV
40 2021 2022
35
The surplus in the services balance came in at $12.1 billion
in the fourth quarter, higher than the $11.5 billion in the
30
preceding quarter. For the whole of 2022, the surplus in the
services balance rose to $45.0 billion, from $31.8 billion
25
in 2021. This was mainly driven by larger net receipts
for transport services and financial services, lower net
20 payments arising from charges for the use of intellectual
property, and a shift from net payments to net receipts
15
IV I II III IV for other business services. These more than offset
2021 2022 the increases in net payments for travel services and
manufacturing services on physical inputs owned by others.
In terms of the sub-components of the current account,
the goods surplus fell to $41.7 billion in the fourth quarter, The primary income deficit increased by $1.6 billion from
from $49.8 billion in the third quarter, as the decline in the previous quarter to $28.9 billion in the fourth quarter.
exports was more than that of imports (Exhibit 5.2). For For the year as a whole, the deficit widened by $10.4 billion
2022 as a whole, the goods balance registered a larger to $104 billion, as payments rose by more than receipts.
surplus of $188 billion, compared to the $169 billion
recorded in 2021, as the exports of goods increased by The secondary income deficit widened to $1.4 billion
more than imports. in the fourth quarter, from $1.2 billion in the preceding
quarter. For the year as a whole, the deficit increased by
$0.3 billion to $5.2 billion as secondary income payments
rose by more than receipts.
CAPITAL AND FINANCIAL Exhibit 5.4: Components of Financial Account (Net)
ACCOUNT $ Billion
120
Other
100 Investment
The capital and financial account1 registered a smaller net
80
outflow of $33.5 billion in the fourth quarter, compared
to the $60.7 billion in the preceding quarter (Exhibit 5.3). 60
Portfolio
For 2022 as a whole, net outflows amounted to $279 40 Investment
billion (43.4 per cent of GDP), an increase from the $11.4 20
billion in 2021. The step-up in net outflows was due to a Financial Derivatives
0
sharp increase in net outflows for “other investment” and
Direct Investment
portfolio investment, as well as a shift from net inflows to -20
net outflows for financial derivatives. -40
IV I II III IV
2021 2022
Exhibit 5.3: Capital and Financial Account Balance
$ Billion
120 Net outflows of portfolio investment rose to $18.6 billion in
the fourth quarter, from $16.5 billion in the previous quarter.
100 For the full year, net outflows of portfolio investment
increased by $14.4 billion to $95.4 billion in 2022.
80
60
Financial derivatives switched to net inflows of $2.4 billion
in the fourth quarter, from net outflows of $3.1 billion
40 in the preceding quarter. However, for 2022 as a whole,
financial derivatives reversed to a net outflow position of
20 $3.1 billion, from a net inflow position of $1.6 billion in 2021.
0
IV I II III IV Net inflows of direct investment reached $34.2 billion in
2021 2022
the fourth quarter, higher than the $32.5 billion in the
previous quarter. For 2022 as a whole, net inflows of direct
In terms of the sub-components of the capital and financial investment rose by $6.3 billion to $124 billion, as the
account, net outflows of “other investment” came in at increase in foreign direct investment flows into Singapore
$51.5 billion in the fourth quarter, down from $73.6 billion exceeded that of residents’ direct investment abroad.
in the preceding quarter (Exhibit 5.4). For the full year,
net outflows of “other investment” reached $305 billion,
a significant increase from the $49.9 billion registered in
2021. This was attributable in part to resident deposit-
taking corporations seeing an increase in net outflows.
1 Net inflows in net balances are indicated by a minus (-) sign. For more details regarding the change in sign convention to the financial account, please refer to DOS’s
information paper on “Singapore’s International Accounts: Methodological Updates and Recent Developments”.
Chapter 5: Balance of Payments 49
CHAPTER
SECTORAL
6 PERFORMANCE
Chapter 6
SECTORAL
PERFORMANCE
OVERALL ECONOMY MANUFACTURING
Nominal Nominal
Real Real
Value Value
STRUCTURE OF ECONOMY Added
Growth CLUSTERS Added
Growth
(%) (%)
Share (%) Share (%)
Total 100.0 3.6

Electronics 48.5 2.6
Goods Producing Industries 25.4 2.9

Chemicals 15.4 -5.5
Manufacturing 21.6 2.5
Biomedical
Construction 2.7 6.7 11.3 -5.0
Manufacturing
Utilities 1.1 1.7 Precision

12.5 6.3
Engineering
Other Goods Industries 0.0 -7.7
Transport
5.8 18.8
Engineering
Services Producing Industries 71.3 4.8
General Manufacturing
6.4 10.1
Wholesale Trade 18.6 3.2 Industries
Retail Trade 1.3 8.4
Transportation & Storage 10.4 4.0 CONSTRUCTION

CERTIFIED PAYMENTS IN 2022
Accommodation 0.7 0.5
50.3%
Public
Food & Beverage Services 0.9 18.2
Information & Communications 5.4 8.6
Finance & Insurance 13.5 1.4

49.7%
Private
Real Estate 2.9 14.1
CONTRACTS AWARDED IN 2022

Professional Services 5.4 7.6
Civil
Institutional
Administrative & Support Services 3.0 6.6 Engineering Residential Industrial
& Others
Commercial
Work
Other Services Industries 9.3 5.2
Ownership of Dwellings 3.3 0.4 $10.2 $9.2 $4.4 $4.3 $1.6

billion billion billion billion billion
Chapter 6: Sectoral Performances 53
WHOLESALE TRADE ACCOMMODATION

PERFORMANCE OF HOTELS
Foreign Domestic
Wholesale Trade Wholesale Trade
Index growth Index growth Hotel Room Gross Lettings
+3.1% -10.5% Revenue Growth Growth
+235.3% +115.8%
RETAIL TRADE FOOD & BEVERAGE SERVICES

PERFORMANCE OF F&B (SALES GROWTH)
Retail Sales Retail Sales
Index Growth Index Growth
(Non-Motor Vehicles) (Motor Vehicles) Food Caterers Restaurants
+11.8% -19.8% +92.4% +27.3%
Cafes, Food Courts &

Other Eating Places Fast Food Outlets
TRANSPORTATION & STORAGE +8.4% +6.7%
Nominal
Real
Value
SEGMENTS Added
Growth
(%)
INFORMATION & COMMUNICATIONS
Share (%)
Nominal
Real
Land Transport* 8.7 10.1 Value
SEGMENTS Added
Growth
(%)
Share (%)
Water Transport* 74.3 1.1
Telecommunications 13.5 -0.4

Air Transport* 5.6 121.8
Storage & Other Support Services 9.7 -3.4 IT & Information

66.4 19.5
Services
Post & Courier Activities 1.7 -4.9
Others 20.1 -12.2
*Including supporting services
+953.1% Air Passengers Handled Growth
-3.7% Total Sea Cargo Handled Growth

FINANCE & INSURANCE PROFESSIONAL SERVICES

Nominal Nominal
Real Real
Value Value
SEGMENTS Added
Growth SEGMENTS Added
Growth
(%) (%)
Share (%) Share (%)
Banking 40.0 -5.7 Legal 8.4 -4.1

Activities Auxiliary to 21.4 11.3
Financial Services Accounting 6.9 15.0
Fund Management 12.4 2.9
Head Offices & Business
30.8 -0.7
Insurance 17.4 0.4 Representative Offices
Business &
Others 8.8 7.8 9.5 2.3
Management Consultancy
Architectural & Engineering,

24.6 16.9
Technical Testing & Analysis
REAL ESTATE
Other Professional,
PRIVATE RESIDENTIAL 19.8 16.8
Scientific & Technical Services
Units Transacted Price Index
Growth Growth
-34.8% +8.6%
ADMINISTRATIVE & SUPPORT SERVICES
COMMERCIAL AND INDUSTRIAL
(RENTAL INDEX GROWTH) Nominal
Real
Value
Commercial
SEGMENTS Added
Growth
Commercial Industrial (%)
Office Space Retail Space Share (%)
Space Rental
+11.7% -2.4% +6.9%
Rental & Leasing 44.2 -2.1
Other Administrative
OTHER SERVICES INDUSTRIES & Support Services
55.8 14.7
Nominal
Real
Value
SEGMENTS Added
Growth
(%)
Share (%)
Public Administration & Defence 26.6 1.5
Education, Health & Social Work 53.8 3.5
Arts, Entertainment & Recreation 8.8 33.3
Others 10.8 5.4

Chapter 6.1
MANUFACTURING
OVERVIEW
The manufacturing sector contracted by 2.6 per cent year-on-year in the fourth quarter of 2022, reversing the
1.1 per cent expansion in the preceding quarter. All clusters saw a fall in output during the quarter, except for
the transport engineering and precision engineering clusters.
For the whole of 2022, the manufacturing sector grew by 2.5 per cent, slower than the 13.3 per cent growth in
2021. All clusters, except for the biomedical manufacturing and chemicals clusters, recorded output growth
for the year.
OVERALL MANUFACTURING Exhibit 6.2: Manufacturing Clusters’ Growth
PERFORMANCE Transport Engineering
Manufacturing output decreased by 2.6 per cent year-on- General Manufacturing

Industries
year in the fourth quarter on account of output contractions
in all clusters, except for the transport engineering and
Precision Engineering
precision engineering clusters (Exhibit 6.1).
For the whole of 2022, the manufacturing sector expanded Electronics
by 2.5 per cent, slower than the 13.3 per cent growth in 2021.
Growth of the sector was supported by output expansions Total Manufacturing
in all clusters except for the biomedical manufacturing and
Biomedical
chemicals clusters (Exhibit 6.2). Manufacturing
Exhibit 6.1: Manufacturing Growth Rates

Chemicals
Per Cent
-10 0 10 20 30
20
Per Cent
2021 2022
16.0
15
PERFORMANCE OF CLUSTERS
10
Output in the transport engineering cluster rose by 11.5
5.8 6.1 per cent year-on-year in the fourth quarter, supported
5 by expansions in the aerospace and marine & offshore
engineering (M&OE) segments. In particular, output in the
1.1 aerospace segment surged by 24.4 per cent due to higher
0 demand for maintenance, repair and overhaul (MRO) jobs
from commercial airlines as global air traffic continued
-2.6 to recover. Likewise, the M&OE segment expanded by 4.1
-5 per cent, supported by a step-up in activity in offshore
IV I II III IV
2021 2022 conversion projects, as well as an increase in production
of oilfield and gasfield equipment. By contrast, the land
segment contracted by 11.0 per cent. For the whole of
2022, the transport engineering cluster expanded by 18.8
per cent.
The precision engineering cluster grew by 6.1 per cent year- Output in the chemicals cluster fell by 10.1 per cent
on-year in the fourth quarter, bolstered by the machinery year-on-year in the fourth quarter, driven by output
& systems segment, which expanded by 11.2 per cent declines in the petrochemicals (-17.6 per cent), specialty
on the back of a rise in the production of semiconductor chemicals (-10.1 per cent) and other chemicals (-7.8 per
foundry equipment. On the other hand, output in the cent) segments. The petrochemicals segment recorded a
precision modules & components segment declined by 4.6 lower level of output amidst plant maintenance shutdowns
per cent, weighed down by a lower level of production of and weak market demand, while the specialties segment
electronic connectors and bonding wire. For the full year, saw a fall in output due to lower levels of production of
the precision engineering cluster expanded by 6.3 per cent. industrial gases and food additives. Meanwhile, the other
chemicals segment contracted due to a drop in the output
The general manufacturing cluster contracted by 1.4 per of fragrances. Conversely, the output of the petroleum
cent year-on-year in the fourth quarter, led by a 7.8 per segment grew by 9.5 per cent on account of higher demand
cent decline in the output of the miscellaneous industries for jet fuel, which was driven in turn by the continued
segment. The latter was in turn due to a lower level of recovery in global air travel. For the whole of 2022, the
output of batteries and structural metal products. By output of the chemicals cluster declined by 5.5 per cent.
contrast, the food, beverages & tobacco and printing
segments recorded output expansions of 3.8 per cent The biomedical manufacturing cluster shrank by 10.5
and 0.5 per cent respectively, with the former recording per cent year-on-year in the fourth quarter due to
an increase in output of dairy products. For the whole of output contractions across all segments. The output
2022, the general manufacturing cluster grew by 10.1 per of the pharmaceuticals segment declined by 15.3 per
cent, with output expansions across all segments. cent because of a different mix of active pharmaceutical
ingredients produced. Meanwhile, output in the medical
The electronics cluster contracted by 2.8 per cent year-on- technology segment fell by 3.4 per cent due to lower
year in the fourth quarter, driven by output contractions export demand for medical devices. For the whole of 2022,
across most segments. Output in the other electronic output in the biomedical manufacturing cluster declined
modules & components (-19.3 per cent), semiconductors by 5.0 per cent.
(-4.5 per cent) and computer peripherals & data storage
(-1.8 per cent) segments declined on the back of softening
external demand. By contrast, output in the infocomms &
consumer electronics segment grew by 5.5 per cent. For the
whole of 2022, the electronics cluster expanded by 2.6 per
cent, with output expansions across all segments, except
for the other electronic modules & components segment.
Chapter 6.2
CONSTRUCTION
OVERVIEW
The construction sector grew by 10.0 per cent year-on-year in the fourth quarter of 2022, faster than the 8.1 per
cent expansion in the previous quarter.
For the whole of 2022, the sector expanded by 6.7 per cent, slower than the 20.5 per cent growth in 2021.1
CONSTRUCTION DEMAND For the full year, total construction demand fell by 0.5 per
cent to $29.8 billion (Exhibit 6.4), as a 3.2 per cent increase
Construction demand (contracts awarded) increased by 8.1 in private sector construction demand was outweighed by a
per cent year-on-year to $7.2 billion in the fourth quarter, 3.0 per cent decline in public sector construction demand.
supported by expansions in both public and private sector The latter was due to a lower volume of public sector
construction demand (Exhibit 6.3). industrial building projects and civil engineering works.
Exhibit 6.3: Contracts Awarded Exhibit 6.4: Contracts Awarded, 2022 ($ Billion)
$ Billion
Total Public Private
10
Total 29.8 17.3 12.5
8
Residential 9.2 5.3 3.9
Total
Commercial 1.6 0.1 1.5
6
Industrial 4.4 0.4 4.1

4 Public
Institutional & Others 4.3 2.9 1.4
Private
Civil Engineering
2 10.2 8.6 1.6
Works
0
IV
2021
I
2022
II III IV Public Sector
In the fourth quarter, public sector construction demand
grew by 9.5 per cent year-on-year to $4.2 billion. This
was supported by higher demand for public residential
(37.0 per cent) and institutional (202.5 per cent) building
projects. However, these increases were partially offset
by a reduction in contracts awarded for public commercial
building (-29.9 per cent), industrial building (-87.2 per cent)
and civil engineering (-11.2 per cent) works.
1 The strong growth of the construction sector in 2021 was mainly due to the low base in 2020 caused by the Circuit Breaker and the slow resumption of construction
activities following the Circuit Breaker.
For the full year, public sector construction demand fell Exhibit 6.5: Certified Payments
by 3.0 per cent to $17.3 billion. The decline was mainly
$ Billion
due to a drop in contracts awarded for public industrial 10
building (-62.4 per cent) and civil engineering (-6.2 per
cent) works. Some of the major projects awarded during
the year include (i) LTA’s MRT contracts for the Cross Island 8
Line (CRL) and Cross Island Line-Punggol Extension; (ii) Total
MOH’s SGH Elective Care Centre/National Dental Centre

and Serangoon Polyclinic; and (iii) PA’s Marine Parade 6
Community Club.
Public
4
Private Sector Private
In the fourth quarter, private sector construction demand 2

increased by 6.1 per cent year-on-year to $3.0 billion.
Except for industrial building projects, which registered
a contraction (-64.0 per cent), all other types of projects 0
saw an increase in demand, ranging from 84.1 per cent IV I II III IV
2021 2022
for residential projects to 596.1 per cent for institutional
projects.
Public Sector
For the full year, private sector construction demand
grew by 3.2 per cent to $12.5 billion, on the back of higher Public sector construction output rose by 25.6 per cent
demand for private industrial building (0.8 per cent), year-on-year to $4.1 billion in the fourth quarter. With the
institutional building (36.2 per cent) and civil engineering exception of public industrial building works, construction
(260.3 per cent) projects. Major projects awarded in 2022 output for all types of works expanded, driven by public
include (i) semiconductor fabrication plants at Pasir Ris and residential building (50.1 per cent), institutional building
Tampines; (ii) a cogeneration plant at Jurong Island; (iii) (31.2 per cent) and civil engineering (16.8 per cent) works.
retrofitting of Mount Elizabeth Hospital; (iv) construction
of container berths at Tuas Terminal Finger 2; and (v) For the full year, public sector construction output increased
island-wide cabling projects. by 16.2 per cent to $15.2 billion, underpinned by public
residential building (44.9 per cent), institutional building
(9.5 per cent) and civil engineering (9.4 per cent) works.
CONSTRUCTION ACTIVITIES Major projects include (i) LTA’s East Coast Integrated
Depot, North South Corridor, Circle MRT Line 6 and Rapid
Construction output (or nominal certified payments) rose Transit System Link; (ii) PUB’s Deep Tunnel Sewerage
by 17.7 per cent year-on-year to $8.2 billion in the fourth System (Phase 2); (iii) MOH’s Woodlands Health Campus,
quarter, supported by expansions in both public and private SGH Emergency Medicine Building and Integrated Care
sector construction output (Exhibit 6.5). Hub; and (iv) Singapore Institute of Technology’s Campus
at Punggol.
For the full year, construction output increased by 15.6
per cent to $30.2 billion, moderating from the 32.5 per
cent growth in 2021.
Private Sector CONSTRUCTION COSTS

In the fourth quarter, private sector construction output Based on BCA’s Building Works Tender Price Index (TPI),
increased by 10.7 per cent year-on-year to $4.1 billion, tender prices increased by about 11.6 per cent in 2022.
as all types of private sector construction works, except This was mainly driven by higher input costs resulting
for industrial and civil engineering works, expanded. from global supply disruptions that were exacerbated
These included private residential building (25.9 per cent), by the Russia-Ukraine war (Exhibit 6.7). Looking ahead,
commercial building (35.5 per cent) and institutional barring fresh supply shocks to key global construction
building (11.7 per cent) works. resources, the uptrend in BCA’s TPI is expected to ease in
2023 in tandem with the moderation of some input prices
For the full year, private sector construction output from their highs in the first half of 2022, as well as an
increased by 15.0 per cent to $15.0 billion. All types of anticipated slowdown in the global economy.
private construction output rose, led by private residential
building (24.3 per cent) and commercial building (30.7 Exhibit 6.7: Changes in Tender Price Index
per cent) works. Major ongoing projects include (i) the Per Cent
redevelopment of past en-bloc sales sites and development 15
of Government Land Sales (GLS) sites; (ii) refurbishment
of existing hotels and development of new hotels; (iii) data
centres; (iv) semiconductor production plants; (iv) Changi
Airport Terminal 2 expansion; and (v) Mandai Wildlife 10
Reserve developments.
CONSTRUCTION MATERIALS 5
In tandem with the rise in construction output, total

consumption of steel rebars2 rose by 31.1 per cent to 0
2018 2019 2020 2021 2022
1.2 million tonnes in 2022. On the other hand, the total
consumption of ready-mixed concrete edged down by 0.3
per cent in 2022 to 11.6 million m3.
The average market price of Grade 40 pump ready-mixed

concrete3 increased by 14.0 per cent year-on-year to
about $118.30 per m3 in the fourth quarter (Exhibit 6.6).
By contrast, the average market price of steel rebars4 fell
by 10.1 per cent to around $999.00 per tonne in the fourth
quarter, following the easing of raw material costs and
freight rates in the second half of 2022.
Exhibit 6.6: Changes in Market Prices of Construction

Materials
Per Cent
60
40 Steel Bars
20
Ready-Mixed
Concrete
0
-20
IV I II III IV
2021 2022
2 Rebar consumption is estimated from net imports plus local production (without factoring in stock levels).
3 The market prices are based on contracts with non-fixed price, fixed price and market retail price.
4 The market prices refer to 16mm to 32mm High Tensile rebar and are based on fixed price supply contracts with a contract period of 12 months or below.
CONSTRUCTION OUTLOOK FOR Exhibit 6.8: Projected Construction Demand in 2023
2023 $ Billion
According to BCA, total construction demand is projected Public Sector 16.0 – 19.0
to be between $27.0 billion and $32.0 billion in 2023
(Exhibit 6.8). In particular, demand from the public sector Building Construction Sub-total 8.6 – 10.9
is expected to stay firm at between $16.0 billion and
$19.0 billion, supported by a continued strong pipeline of Residential 4.7 – 6.3
public housing, institutional building and infrastructure
projects. Meanwhile, total private sector construction Commercial 0.1 – 0.1
demand is projected to be between $11.0 billion and $13.0
billion in 2023, comparable to the annual volume in the Industrial 0.8 – 1.0
previous two years. This is expected to be supported by
(i) a ramp-up in Build-To-Order HDB flats; (ii) the Central
Institutional & Others 2.9 – 3.5
Business District (CBD) Incentive Scheme on conversion to
residences; (iii) commercial building redevelopments; (iv)
high-specification industrial buildings; and (v) mechanical Civil Engineering Works Sub-total 7.5 – 8.1
& electrical contracts for North South Corridor, CRL and
Jurong Region MRT Line. Private Sector 11.0 – 13.0
Total construction output in 2023 is projected to increase Building Construction Sub-total 10.2 – 12.0
to between $30.0 billion and $33.0 billion, supported by a
steady level of construction demand and some remaining Residential 3.6 – 4.0
backlogs of construction works that were disrupted by the
COVID-19 pandemic. Commercial 2.5 – 3.0
Industrial 3.3 – 4.0
Institutional & Others 0.8 – 1.0
Civil Engineering Works Sub-total 0.8 – 1.0
TOTAL CONSTRUCTION DEMAND 27.0 – 32.0

Chapter 6.3
WHOLESALE TRADE
OVERVIEW
The wholesale trade sector expanded by 2.4 per cent year-on-year in the fourth quarter of 2022, moderating
from the 4.1 per cent growth in the previous quarter. Growth during the quarter came largely on the back of an
increase in the volume of foreign wholesale sales of petroleum & petroleum products and telecommunications
& computers.
For the whole of 2022, the sector grew by 3.2 per cent, slowing from the 9.6 per cent expansion in 2021.
WHOLESALE SALES Exhibit 6.9: Changes in Wholesale Trade Index in Chained

Volume Terms
In the fourth quarter, the wholesale trade sector was Per Cent
supported by an increase in foreign wholesale sales 10
volume, which outweighed a decline in domestic wholesale
sales volume. Foreign Wholesale Trade Index
5
Specifically, foreign wholesale sales volume rose by 1.2

per cent year-on-year in the fourth quarter, moderating 0
from the 2.8 per cent increase in the preceding quarter

(Exhibit 6.9). Growth was largely due to an increase in -5
the sales volumes of petroleum & petroleum-related Domestic Wholesale Trade Index
products (3.3 per cent), telecommunications & computers -10
(7.4 per cent) and other wholesale trade5 (5.3 per cent),
which outweighed a decline in the sales volume of metals,
-15
timber & construction materials (-13.5 per cent). For the
whole of 2022, the foreign wholesale trade index rose by
-20
3.1 per cent, easing from the 8.8 per cent increase in the IV I II III IV
previous year. 2021 2022
Meanwhile, domestic wholesale sales volume fell by 0.3

per cent year-on-year in the fourth quarter, extending
the 6.5 per cent contraction in the preceding quarter. The
decline was led by weaker sales volumes in segments such
as telecommunications & computers (-18.9 per cent) and
chemicals & chemical products (-23.3 per cent), which
outweighed increases in the sales volumes of petroleum
& petroleum products (4.2 per cent), ship chandlers &
bunkering (18.1 per cent) and other wholesale trade (9.2
per cent). For the whole of 2022, the domestic wholesale
trade index fell by 10.5 per cent, worsening from the 0.5
per cent decline recorded in 2021.
5 The “other wholesale trade” segment consists of a diverse range of products that include agricultural raw materials and live animals, tropical produce, personal
effects and medicinal and pharmaceutical products, among others.
Chapter 6.4
RETAIL TRADE
OVERVIEW
The retail trade sector grew by 5.1 per cent year-on-year in the fourth quarter of 2022, moderating from the 8.8
per cent growth in the previous quarter.
For the whole of 2022, the sector expanded by 8.4 per cent, extending the 12.0 per cent growth in 2021.
RETAIL SALES For the full year, overall retail sales volume rose by 7.2 per
cent, extending the 11.2 per cent expansion in 2021. With
Overall retail sales volume increased by 4.6 per cent year- this increase, overall retail sales volumes have recovered
on-year in the fourth quarter, slower than the 8.8 per cent to 2019 (pre-pandemic) levels on a full-year basis.
growth in the third quarter (Exhibit 6.10). Overall retail
sales were supported by an increase in non-motor vehicle In 2022, non-motor vehicle sales volume rose (11.8 per
sales volume (8.1 per cent), which saw broad-based growth cent) while motor vehicle sales volume declined (-19.8 per
across segments. In particular, the sales volumes of food cent). The growth in non-motor vehicle sales volume was
& alcohol (41.2 per cent), wearing apparel & footwear (27.8 led by the sales of wearing apparel & footwear (40.8 per
per cent), watches & jewellery (20.2 per cent), department cent), food & alcohol (31.3 per cent), department stores
stores (18.5 per cent) and cosmetics, toiletries & medical (28.5 per cent) and watches & jewellery (27.7 per cent).
goods (15.5 per cent) registered the strongest growth. Meanwhile, the sales volumes of mini-marts & convenience
On the other hand, the sales volumes of supermarkets & stores (-7.2 per cent) and supermarkets & hypermarkets
hypermarkets (-9.0 per cent), mini-marts & convenience (-5.9 per cent) fell (Exhibit 6.11).
stores (-5.2 per cent) and petrol service stations (-2.8 per
cent) registered the largest declines. Meanwhile, motor Exhibit 6.11: Changes in Retail Sales Index in Chained
vehicle sales volume fell by 19.8 per cent due to a reduction Volume Terms for Major Segments in 2022
in COE quotas.
Wearing Apparel & Footwear 40.8
Exhibit 6.10: Changes in Retail Sales Index in Chained Food & Alcohol 31.3
Volume Terms Department Stores 28.5

Watches & Jewellery 27.7
Per Cent
Cosmetics, Toiletries & Medical Goods 18.7
20
Recreational Goods 11.3
Total Others 8.8

(excluding Computer & Telecomms Equipment 8.6
Motor Vehicles)
15
Furniture & Household Equipment 3.4
Optical Goods & Books 3.3
Petrol Service Stations 0.1

10 Total Supermarkets & Hypermarkets -5.9
Mini-marts & Convenience Stores -7.2
Motor Vehicles -19.8
5 -40 -30 -20 -10 0 10 20 30 40 50
Per Cent
0
IV I II III IV
2021 2022
Chapter 6.5
TRANSPORTATION &
STORAGE
OVERVIEW
TThe transportation & storage sector expanded by 2.5 per cent year-on-year in the fourth quarter of 2022,
moderating from the 6.1 per cent growth in the previous quarter.
For the whole of 2022, the sector grew at a slower pace of 4.0 per cent compared to the 9.9 per cent expansion
recorded in 2021. The expansion of the sector was supported largely by the air transport, land transport and
water transport segments.
WATER TRANSPORT AIR TRANSPORT

Container throughput fell by 0.5 per cent year-on-year in the Total air passenger traffic (less transit) handled by Changi
fourth quarter, a reversal from the 2.0 per cent expansion Airport climbed by 735 per cent year-on-year in the fourth
in the previous quarter (Exhibit 6.12). For the full year, the quarter, extending the 1,481 per cent growth in the previous
number of TEUs (Twenty-Foot Equivalent Units) handled by quarter (Exhibit 6.13). Nonetheless, in absolute terms,
Singapore’s ports came in at 37.3 million, representing a air passenger traffic volume had only recovered to 69.0
0.5 per cent decline from 2021’s level. This was a reversal per cent of the volume seen in the fourth quarter of 2019
from the 1.6 per cent increase recorded in 2021. (pre-pandemic).
Exhibit 6.12: Changes in Container Throughput and Sea For the full year, total air passenger traffic passing through
Cargo Handled Changi Airport surged by 953 per cent to come in at 31.9
million. This was a marked turnaround from the 74.0 per
Per Cent
cent plunge in 2021.
5
Container
Exhibit 6.13: Changes in Air Transport
Throughput
Per Cent
0
1500
Air Passengers
-5 1000
Sea Cargo
500
-10
IV I II III IV Aircraft Landings
2021 2022 0
Air Cargo
Overall sea cargo volume declined by 4.8 per cent in the

fourth quarter, extending the 1.2 per cent contraction in -500
IV I II III IV
the preceding quarter. The fall in sea cargo volume was 2021 2022
largely due to general cargo shipments, which declined
by 8.3 per cent during the quarter, an extension of the 3.0
per cent contraction registered in the third quarter. For
the whole of 2022, overall sea cargo volume fell by 3.7 per
cent, reversing the 1.5 per cent growth in the previous year.
At the same time, air cargo volume fell by 16.1 per cent
year-on-year in the fourth quarter, extending the 6.0 per
cent contraction in the previous quarter. In absolute terms,
total air cargo volume was at 87.3 per cent of pre-pandemic
levels (i.e., in the fourth quarter of 2019). For 2022 as a
whole, air cargo shipments declined by 4.8 per cent, a
sharp pullback from the 26.1 per cent expansion in 2021.
Meanwhile, aircraft landings climbed by 116 per cent on-

year to reach 35,368 in the fourth quarter, following the
117 per cent increase in the third quarter. This brought
the total number of aircraft landings in 2022 to 109,246,
which was 101 per cent higher compared to that in 2021.
Chapter 6.6
ACCOMMODATION
OVERVIEW
The accommodation sector grew by 7.8 per cent year-on-year in the fourth quarter of 2022, accelerating from
the 1.6 per cent expansion in the previous quarter.
For the whole of 2022, the sector expanded by 0.5 per cent, a turnaround from the 9.1 per cent contraction in 2021.
VISITOR ARRIVALS In terms of source markets, Singapore’s top five visitor-

generating markets in 2022 were Indonesia (1.1 million
Singapore received around 2.6 million visitors in the visitors), India (686,000 visitors), Malaysia (591,000 visitors),
fourth quarter, 1,523 per cent higher compared to the Australia (566,000 visitors) and the Philippines (382,000
same period a year ago (Exhibit 6.14). The sharp increase visitors). Together, they accounted for 52.8 per cent of
in visitor arrivals was due to the relaxation of inbound total visitor arrivals in 2022.
travel restrictions relative to 2021 with the rollout of the
Vaccinated Travel Framework (VTF) in April 2022. Compared Among the top 10 visitor-generating markets, Vietnam
to the same period in 2019, visitor arrivals remained 46.5 (8,980 per cent), Thailand (6,372 per cent) and Australia
per cent lower. For the full year, visitor arrivals increased (5,527 per cent) posted the strongest growth in visitor
by 1,810 per cent, a significant turnaround from the 88.0 arrivals in 2022 (Exhibit 6.15).
per cent decline recorded in 2021.
Exhibit 6.15: Growth Rates of Top 10 Visitor-Generating
Exhibit 6.14: Visitor Arrivals Markets in 2022
Thousand Per Cent

3000 6000 Vietnam 8,980
Thailand 6,372
2500 5000
Australia 5,527
Philippines 3,223
2000 4000
YOY Change
(RHS) Indonesia 3,200
1500 3000 South Korea 2,953
United States 2,806

1000 2000
United
Kingdom 2,551
500 1000 Malaysia 2,340
India 1,162
0 0
IV I II III IV 0 2000 4000 6000 8000 10000
2021 2022 Per Cent
ACCOMMODATION
In tandem with the strong recovery in visitor arrivals,
gross lettings of gazetted hotel rooms grew robustly by
147 per cent year-on-year in the fourth quarter, extending
the 167 per cent growth in the previous quarter (Exhibit
6.16). Similarly, room revenue surged by 274 per cent
year-on-year, extending the 363 per cent increase in the
preceding quarter. Higher room revenue was accompanied
by a rise in both the average occupancy rate of gazetted
hotels and the average daily room rate. Specifically, the
average occupancy rate rose by 11.2 percentage-points to
83.3 per cent, while the average daily room rate increased
by 51.4 per cent to $283 in the fourth quarter.
For 2022 as a whole, the accommodation sector grew by

a modest 0.5 per cent, as the recovery in tourism demand
was largely offset by a reduction in government bookings6.
The overall room revenue of gazetted hotels climbed by
235 per cent to reach $3.2 million in 2022, driven by a 116
percent expansion in gross lettings and a 55.1 increase in
the average daily room rate.
Exhibit 6.16: Gross Lettings

Thousand Per Cent
5000 200
YOY Change
(RHS)
4000 150
3000 100
2000 50
1000 0
0 -50
IV I II III IV
2021 2022
6 The gross lettings and room rates data do not include hotel rooms contracted by the Government to serve as government quarantine facilities (GQFs) or stay-home-
notice dedicated facilities (SDFs).
Chapter 6.7
FOOD & BEVERAGE

SERVICES
OVERVIEW
The food & beverage services sector grew by 19.6 per cent year-on-year in the fourth quarter of 2022, extending
the 29.3 per cent growth in the previous quarter.
For the whole of 2022, the sector expanded at a faster pace of 18.2 per cent compared to the 1.8 per cent growth
in 2021.
FOOD & BEVERAGE SALES For the whole of 2022, the food & beverage services volume
index grew by 18.0 per cent. This was an acceleration of
Overall food & beverage sales volume increased by 15.9 the 2.8 per cent increase recorded in 2021. Nonetheless,
per cent year-on-year in the fourth quarter, extending the overall food & beverage sales volume remained 10.8
the 28.4 per cent expansion in the preceding quarter per cent lower than that in 2019. At the segment level,
(Exhibit 6.17). The growth in sales volume came on the the sales volumes of restaurants (27.3 per cent), food
back of the relaxation of dine-in restrictions compared caterers (92.4 per cent), fast food outlets (6.7 per cent)
to the Stabilisation Phase in the fourth quarter of 20217. and cafes, food courts & other eating places (8.4 per cent)
Sales volumes saw broad-based growth, led by the food all increased in 2022.
caterers segment (118 per cent). At the same time, the
restaurants (16.8 per cent), fast food outlets (9.7 per cent)
and cafes, food courts & other eating places (6.6 per cent)
segments also saw strong growth. The robust growth
seen in the food caterers segment was due to the lifting
of restrictions on events, which led to a strong recovery
in leisure, business and MICE events. However, relative
to the same period in 2019, the sales volume in the food
caterers segment remained 23.4 per cent lower.
Exhibit 6.17: Changes in Food and Beverage Services Index

in Chained Volume Terms
Per Cent
40
30
20
10
-10
IV I II III IV
2021 2022
7 For instance, from 1 October to 9 November 2021, dine-in group sizes were restricted to no more than two vaccinated persons.
Chapter 6.8
INFORMATION &
COMMUNICATIONS
OVERVIEW
The information & communications sector expanded by 5.6 per cent year-on-year in the fourth quarter of
2022, extending the 6.9 per cent growth in the previous quarter. This positive outturn was largely due to the IT
& information services segment, while the telecommunications segment saw more modest growth during the
quarter. On the other hand, the “others” segment8 contracted.
For the whole of 2022, the sector grew by 8.6 per cent, a slowdown from the 13.4 per cent expansion in 2021.
IT & INFORMATION SERVICES Exhibit 6.18: Information & Communications Growth

Per Cent
In 2022, the growth of the information & communications
10
sector was led by the IT & information services segment.
Specifically, the segment expanded by 19.5 per cent,
driven by strong enterprise demand for digital solutions Mobile
Subscriptions
and services. 5
TELECOMMUNICATIONS
0
The telecommunications segment shrank by 0.4 per
cent in 2022, weighed down by weaker demand for fixed
line services. For instance, the total number of fixed line
subscribers declined by 2.6 per cent on a year-on-year -5
basis in the third quarter of 2022. This was partially offset Broadband
Subscriptions
by an increase in mobile and broadband subscriptions
over the same period.
-10
2018 2019 2020 2021 2022
In September 20229, the number of mobile subscriptions
grew by 6.4 per cent compared to the same period in 2021
(Exhibit 6.18). While there was a 24.7 per cent decline in
the number of 3G subscriptions to 527,000, this was offset
by a 9.3 per cent increase in 4G subscriptions to around
8.7 million.
In September 2022, the number of broadband subscriptions

rose by 6.4 per cent. The increase was broad-based, led by
a 7.0 per cent increase in wireless broadband subscriptions.
8 The “others” segment consists of (i) publishing activities (including computer games and software publishing), (ii) motion picture, video and other programme
production, sound recording, and music publishing activities, and (iii) radio and television broadcasting activities.
9 Full-year data are not available at the time of publication. October and November data are available but subject to further revisions.
Chapter 6.9
FINANCE &
INSURANCE
OVERVIEW
The finance & insurance sector contracted by 0.3 per cent year-on-year in the fourth quarter of 2022, a reversal
from the 0.5 per cent expansion in the previous quarter.
For the whole of 2022, the sector expanded by 1.4 per cent, moderating from the 8.3 per cent growth in the
preceding year.
COMMERCIAL BANKS Exhibit 6.20: Growth of Commercial Bank Loans and

Advances to Residents by Industry in 2022
In 2022, total assets/liabilities of commercial banks Non-bank Financial & Insurance 12.2
increased by 7.7 per cent to $3.3 trillion (Exhibit 6.19).
Housing & Bridging Loans 3.6
Exhibit 6.19: Total Assets/Liabilities of Commercial Banks Business Services 2.2
$ Billion Per Cent

Building & Construction 2.1
4000 10
Total -0.3
YOY Change
(RHS) Manufacturing -1.0
3000 8
Professional & Private Individuals -6.2
Transport & Communications -6.3

2000 6
Others -10.0
General Commerce -11.4
1000 4 -20 -10 0 10 20
Per Cent
0 2
2018 2019 2020 2021 2022 Exhibit 6.21: Growth of Commercial Bank Loans and
Advances to Non-Residents by Region in 2022
On the assets side, domestic interbank lending rose by $3.4
billion (2.0 per cent). However, domestic credit extended
Europe 3.5
to non-bank customers fell by $34.8 billion (-2.6 per cent),
with total loans and advances to residents contracting by
0.3 per cent. Others 0.7
Total -6.3
East Asia -9.7
Americas -10.2
-15 -10 -5 0 5 10
Per Cent
Business lending shrank by 0.8 per cent, weighed down Exhibit 6.23: Growth of Loans and Advances of Finance
mainly by a decline in loans to the general commerce Companies in 2022
and transport & communications sectors, although
this was partially offset by resilient demand for loans
from the non-bank financial & insurance and business Housing Loans 41.5
services sectors (Exhibit 6.20). In comparison, consumer

lending expanded by 0.6 per cent. Growth in this segment
was mainly attributed to a pickup in housing & bridging Hire Purchase 10.6
loans, even as car loans and share financing weakened. Finance
Meanwhile, loans to non-residents contracted by 6.3 per
cent, with East Asia and the Americas contributing the
most to the decline (Exhibit 6.21). Total 8.5
On the liabilities front, the total deposits of non-bank

customers grew by 7.3 per cent in 2022. As of end-2022,
total non-bank deposits amounted to $1.7 trillion, higher Others 4.9
than the $1.6 trillion in the year before, mainly driven by
a 70.7 per cent increase in fixed deposits. 0 10 20 30 40 50
Per Cent
FINANCE COMPANIES
Exhibit 6.24: Total Assets/Liabilities of Merchant Banks
Total assets/liabilities of finance companies grew by 8.8 $ Billion Per Cent
per cent in 2022 to $18.8 billion, a reversal from the 2.0
120 10
per cent contraction in 2021 (Exhibit 6.22). YOY Change
(RHS)
Exhibit 6.22: Total Assets/Liabilities of Finance Companies 100 5
$ Billion Per Cent
20 YOY Change 10 80 0
(RHS)
60 -5
15 0
40 -10
10 -10
20 -15
2018 2019 2020 2021 2022
5 -20
0 -30
2018 2019 2020 2021 2022
Non-bank lending expanded by 8.5 per cent in 2022, in

contrast to the 1.1 per cent decline in the previous year,
as housing loans and hire purchase finance recorded firm
growth (Exhibit 6.23). Meanwhile, deposits of non-bank
customers also rose by 10.8 per cent in 2022, turning
around from the 2.7 per cent contraction in 2021.
MERCHANT BANKS STOCK MARKET

Total assets/liabilities of merchant banks shrank by 6.1 The benchmark Straits Times Index (STI) built on its
per cent to $94.7 billion in 2022, extending the 3.5 per cent recovery from end-2021 into early 2022, alongside the
decline in the previous year (Exhibit 6.24). The contraction pickup in economic activity. However, the onset of the
stemmed from a decline in loans & advances to non-bank Russia-Ukraine war in late February dented its growth
customers and interbank lending. momentum. Thereafter, the attendant rise in global inflation
prompted central banks to tighten financial conditions
aggressively, which led to the repricing of financial assets.
INSURANCE INDUSTRY The ensuing market volatility led to a fall in risk sentiment
and the STI reached a nadir in late October.
Total weighted new business premiums in the direct life
insurance industry fell by 4.1 per cent to $6.3 billion in 2022 The STI saw an uptick in the last two months of the year
(Exhibit 6.25). Single premium business declined by 9.4 as global inflation started to show signs of peaking.
per cent to $23.5 billion, while regular premium business Overall, the STI grew by 4.1 per cent in 2022 (Exhibit 6.26),
decreased by 0.6 per cent to $3.9 billion. Overall, the net supported by equities in the banking and travel-related
income of the direct life insurance industry contracted sectors. The former benefitted from the higher interest
significantly from $1.6 billion in 2021 to -$1.5 billion in rate environment, while the latter was buoyed by the
2022, largely due to a fall in investment income. ongoing recovery in tourism flows.
In the general insurance industry, gross premiums Exhibit 6.26: Straits

Index
Times Index
increased by 9.7 per cent to $18.3 billion in 2022, with Index
offshore and domestic businesses accounting for $12.9 3600
billion and $5.4 billion respectively. The general insurance
industry recorded an operating profit of $0.5 billion in 2022,
3400
down from the $1.2 billion in the previous year, largely due
to poorer investment income.
3200
Exhibit 6.25: Premiums in the Insurance Industry

3000
$ Billion
20
2800
2600
15
2400
10 2200
2020
2020 2021 2022
0
Life Industry Industry General Insurance Industry
2021 2022
SECURITIES MARKET FOREIGN EXCHANGE MARKET

In 2022, the total turnover value of the securities market In 2022, the US dollar strengthened against the Euro,
shrank by 6.2 per cent to $308 billion, and total turnover Japanese Yen and British Pound by 5.2 per cent, 12.1 per
volume fell by 26.0 per cent to 354 billion shares, compared cent and 10.4 per cent respectively, as the Federal Reserve
with 2021. This translated to a 5.0 per cent fall in the embarked on the fastest pace of rate hikes since the
average daily traded value to $1.2 billion, and a 25.1 per Volcker era to curb inflationary pressures. The US dollar
cent contraction in the average daily traded volume to 1.4 rally unfolded in two phases: after rallying in the first
billion shares. three quarters of 2022, the US dollar reversed part of its
gains in the last quarter of 2022 as declines in US headline
At the end of 2022, the total number of listed companies in inflation prompted the Federal Reserve to slow its pace
Singapore was 651, with a combined market capitalisation of rate hikes. Relative to the Euro and British Pound, the
of $830 billion, which was 7.5 per cent lower compared Japanese Yen weakened on the Bank of Japan’s decision
to 2021. Of these listed companies, 439 were listed on to keep its policy rate unchanged at negative levels, even
SGX’s Mainboard, while the other 212 were listed on as the European Central Bank and Bank of England joined
SGX’s Catalist. the Federal Reserve in raising policy rates.
DERIVATIVES MARKET
In 2022, SGX’s derivatives market activity grew by 12.2
per cent to 260 million contracts. Compared to 2021, total
futures trading volume increased by 12.3 per cent to 250
million, while options on futures trading volume rose by
9.4 per cent to 10.2 million contracts. The most actively-
traded contracts in 2022 were the FTSE China A50 Index
Futures, the SGX Nifty 50 Index Futures and the FTSE
Taiwan Index Futures, which formed 57.9 per cent of the
total volume traded on SGX’s derivatives trading platform.
Chapter 6.10
REAL ESTATE &

PROFESSIONAL SERVICES
OVERVIEW
The real estate sector expanded by 15.2 per cent year-on-year in the fourth quarter of 2022, extending the 14.8
per cent growth in the previous quarter. For the whole of 2022, the sector grew by 14.1 per cent, moderating from
The professional services sector expanded by 6.1 per cent year-on-year in the fourth quarter of 2022, extending
the 7.9 per cent growth in the previous quarter. For 2022 as a whole, the sector grew by 7.6 per cent, faster than
REAL ESTATE
The private residential property market softened in the In the commercial space segment, the performance of the
fourth quarter, as total private residential property sales retail space market remained weak in 2022. Specifically,
fell by 54.7 per cent year-on-year, extending the 32.3 per private retail space rental fell by 2.4 per cent in 2022,
cent decline in the previous quarter. For the full year, total although this was an improvement from the 6.8 per cent
sales fell by 34.8 per cent to 21,890 units, from the 33,557 decline in the previous year (Exhibit 6.28). The weak rental
units sold in 2021. performance was due to lower rentals in the Central Area
(-2.1 per cent) and Fringe Area (-3.1 per cent). Similarly,
Reflecting the weaker demand, the increase in private the prices of private retail space declined by 7.8 per cent
residential property prices tapered off in the fourth quarter, in 2022, extending the 4.2 per cent fall recorded in 2021.
coming in at 0.4 per cent compared to the 3.8 per cent While prices in the Central Area dropped by 11.3 per cent,
increase in the preceding quarter. For the whole of 2022, prices in the Fringe Area rose by 1.0 per cent.
prices climbed by 8.6 per cent, following the increase of
10.6 per cent in 2021 (Exhibit 6.27). Exhibit 6.28: Changes in Rentals of Private Sector Office and
Retail Spaces
Exhibit 6.27: Total Sales of Private Residential Units and
Private Residential Property Price Index Per Cent
15
Thousand 2009 Q1 = 100
10 190
10
8 185 Office
5
6 180
0
4 175 Retail
-5
2 170
-10
0 165
IV I II III IV -15
2021 2022 2018 2019 2020 2021 2022
Total Sales Property Price Index (RHS)
On the other hand, the office space market improved in PROFESSIONAL SERVICES
2022. Office rental rose by 11.7 per cent, accelerating from
the 1.9 per cent increase in the previous year, on account In 2022, the professional services sector expanded, with
of higher rentals in the Central Area (11.9 per cent) and all segments registering growth except for the legal and
Fringe Area (11.6 per cent). Prices in the office space head offices & business representative offices segments.
market inched down by 0.1 per cent in 2022, moderating Growth in the sector was largely driven by the architectural
from the 5.8 per cent decline in 2021. & engineering, technical testing & analysis segment,
as well as the other professional scientific & technical
In the industrial space market, overall rental rose by 6.9 services segment, which expanded by 16.9 per cent and
per cent in 2022, faster than the 2.0 per cent increase 16.8 per cent respectively.
seen in the previous year (Exhibit 6.29). Rentals of all types
of industrial property space (i.e., single-use factories,
multiple-user factories, warehouses and business parks)
increased in 2022. Meanwhile, overall industrial property
prices grew by 7.5 per cent, accelerating from the 4.4 per
cent increase in 2021.
Exhibit 6.29: Occupancy Rate and Rental Growth of

Industrial Space
Per Cent Per Cent

100 10
90 5
80 0
70 -5
60 -10
2018 2019 2020 2021 2022
Multiple-User Factory Space Occupancy Warehouse Space Occupancy

Rental Growth (RHS)
Box Article 6.1
TRENDS IN THE RECOVERY OF RETAIL

AND FOOD & BEVERAGE SPENDING IN
SINGAPORE
OVERVIEW
The onset of the COVID-19 pandemic in 2020 severely disrupted firms in the Retail
and Food & Beverage (F&B) sectors in Singapore, as COVID-19 restrictions, such as
safe distancing measures and the closure of physical workplace premises during
the Circuit Breaker, caused customer footfall to plummet, while border restrictions
led tourist arrivals to come to a standstill. At the same time, the COVID-19 pandemic
also accelerated secular trends such as the shift towards hybrid work arrangements
and online spending. Using data from internal government sources and a payment
provider network, this study examines the trends in Retail and F&B spending during
and subsequent to the COVID pandemic.
FINDINGS
Breakdown of spending by geographies: Spending dipped more severely in downtown areas
relative to heartland areas during periods of COVID-19 restrictions. Since then, the recovery
in spending in heartland areas has been stronger than that in downtown areas for F&B
spending, while the converse is true for retail spending.
Shift of spending to online channels: Proportion of online spending in both Retail and
F&B surged during periods of COVID-19 restrictions. Subsequently, with the progressive
ADD TO CART
easing of COVID-19 restrictions, these proportions of online spending fell to levels that
were lower than the peaks seen at the height of the pandemic during the Circuit Breaker
period, but still higher than the levels seen before the pandemic in January 2020.
POLICY TAKEAWAY
Having emerged from the COVID-19 pandemic after more than two years, retail and F&B
spending have rebounded strongly. At the same time, there are also signs of a structural
shift towards online spending, and a redistribution of F&B spending share towards the
heartlands. While global macroeconomic uncertainties may dampen consumer sentiments
in the near term, the prospects for Singapore’s retail and F&B sectors remain positive
given the continued recovery in tourism demand, resilient labour market conditions and
the Government’s continued commitment to upgrading the capabilities of our firms and
workers in these sectors.
BOX 6.1: TRENDS IN THE RECOVERY OF RETAIL AND FOOD &

BEVERAGE SPENDING IN SINGAPORE
The onset of the COVID-19 pandemic in 2020 severely disrupted firms in the Retail and Food & Beverage (F&B) sectors
in Singapore, as COVID-19 restrictions, such as safe distancing measures and the closure of physical workplace
premises during the Circuit Breaker, caused customer footfall to plummet, while border restrictions led tourist arrivals
to come to a standstill. At the same time, the COVID-19 pandemic also accelerated secular trends such as the shift
towards hybrid work arrangements and online spending. This box article examines how spending in the Retail and
F&B sectors were affected by the pandemic, and their subsequent recovery paths.
The analysis in this article draws on two data sources. The first data source is the Retail Sales Index (RSI) and Food
& Beverage Services Index (FBSI) compiled by the Department of Statistics (DOS). These indices are compiled on a
monthly basis, through surveys of firms, to measure changes in retail and F&B sales respectively1.
The second data source is spending indices for both sectors2 from a payment provider network with a substantial
market share in Singapore. These spending indices confer two benefits over the RSI and FBSI. First, they allow us to
assess distinct spending trends by geographies across Singapore. Second, they come at a daily frequency, and are
hence able to track the impact of changes in COVID-19 restrictions more responsively.
Topline Spending Trends in the Retail and Food & Beverage Sectors
Singapore confirmed its first local case of COVID-19 on 23 January 2020, and subsequently declared a state of
DORSCON Orange on 7 February 2020. This led to a fall in retail and F&B spending, as could be seen from both the
spending indices from the payment provider, as well as DOS’s RSI and FBSI (Exhibit 1). In particular, data from the
payment provider indicated that retail and F&B spending fell to 83.2 per cent3 and 82.4 per cent of January 2020 levels4
respectively by end-February 2020.
Subsequently, during the Circuit Breaker5, which stretched from 7 April to 2 June 2020, retail and F&B spending
plummeted to a low of 70.3 per cent and 17.9 per cent of January 2020 levels respectively. The relative resilience of
retail spending compared to F&B spending could be partly because consumers were substituting from dining-in at F&B
establishments to food purchases at supermarkets and hypermarkets. Purchases of electronic and home furnishing
also picked up during this period because of work-from-home and home-based learning requirements.
Since the end of the Circuit Breaker, both retail and F&B spending have generally been on an upward trend, with
spikes during the 2020 and 2021 year-end holiday seasons, and dips when COVID-19 restrictions were tightened,
such as when Singapore entered into Phase 2 Heightened Alert6 on 16 May 2021 and again on 22 July 2021. A notable
divergence in the trends between the two could be seen from May to June 2021, and from July to August 2021, when
F&B spending dropped significantly from around 130 per cent (in May and July 2021) to around 60 per cent (in June and
August 2021) of January 2020 levels, whereas retail spending remained relatively unaffected. The relative resilience
of retail spending could again be due to spending in supermarkets and hypermarkets during periods of tightened
restrictions. As of 30 November 2022, retail and F&B spending had recovered to 164 per cent and 125 per cent of
January 2020 levels respectively.
1 For more details on the RSI and FBSI methodology, see DOS’s information paper “Re-basing of the Retail Sales and Food & Beverage Services Indices (2017 = 100)”.
The two indices are presented by DOS in both current and constant prices, with the latter removing price effects to measure the changes in real economic activity.
2 For the data provided by the payment provider network, spending in the Retail sector comprises eight categories: Wearing Apparel & Footwear, Petrol Service
Stations, Department Stores, Medical Goods & Toiletries, Computer & Telecommunications Equipment, Supermarkets & Hypermarkets, Furniture & Household
Equipment, and Watches & Jewellery. There is only one category of spending in the F&B sector.
3 Index points for the data provided by the payment provider network are percentage-points of average day-of-week spending in January 2020, i.e., 100 index points
= average day-of-week spending in January 2020.
4 Data from the payment provider network goes back only to 1 January 2020. As such, we use January 2020 levels as our pre-COVID comparison; such comparisons
may include seasonal effects.
5 During the Circuit Breaker, most physical workplace premises were closed, except for those providing essential services and in selected economic sectors of
critical importance, while schools moved to full home-based learning, so as to significantly reduce movements and interactions in public and private places.
6 During Phase 2 (Heightened Alert), dining-in at F&B establishments was prohibited, the group size for social gatherings was tightened, and work-from-home was
reinstated as the default working arrangement.
Exhibit 1: Spending in Retail and Food & Beverage Sectors (Per Cent of January 2020 levels)
Per Cent of Jan-20
CB P2&3 HA SP
180
160
140
120
100
80
60
40
20
0
Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 Jul-22 Oct-22
Total Retail Spending Index DOS's RSI F&B Spending Index DOS's FBSI
Notes: Solid lines plot the 7-day moving averages of the indices of nominal spending at Singapore-based merchants, obtained from a payment provider network. Dashed
lines plot the monthly non-seasonally-adjusted RSI or FBSI series (current prices) obtained from DOS. Blue lines represent retail spending and red lines represent F&B
spending. The baseline of 100 represents average day-of-week spending in January 2020. CB stands for Circuit Breaker, P2&3 HA stands for Phase 2 and 3 Heightened
Alert, and SP stands for Stabilisation Phase.
Underlying these topline trends are variations by geographical regions and online versus in-person spending. The
next two sections describe these in greater detail.
Breakdown of Spending Trends by Geographical Regions7
The pandemic has led to a redistribution of spending share across geographical regions in Singapore, likely driven by
work-from-home arrangements that dominated work practices at the height of the pandemic, and remain prevalent
even after the transition to the Stabilisation Phase on 21 November 2021.
As can be seen from Exhibits 2a and 2b, for the most part of the pandemic, and especially during the Circuit Breaker
and Heightened Alert periods, retail and F&B spending fell by more (relative to their respective January 2020 levels)
in downtown areas than in heartland areas. This could be attributed in large part to COVID-19 restrictions such as
work-from-home requirements. Although retail and F&B spending in both downtown and heartland areas have
generally been on a path of recovery since the transition to Stabilisation Phase, the recovery in spending in heartland
areas has been stronger than that in downtown areas for F&B spending, while the converse is true for retail spending.
These trends suggest that there has been a redistribution of F&B spending share towards the heartlands, likely due
to the prevalence of hybrid work arrangements even after the easing of work-from-home measures. This is, however,
not seen for retail spending, possibly because of the quality and diversity of retail experience in the downtown areas
compared to the heartland areas.
These observations are similar to findings from studies by Barrero et al. (2021) and De Fraja et al. (2021) in the United
States and United Kingdom respectively, both of which concluded that work-from-home policies arising from the
pandemic drew F&B spending out of major city centres towards residential neighbourhoods.
7 The focus of this section is on in-person spending trends, as online spending cannot by disaggregated by geographical regions.
Exhibit 2a and 2b: Spending in Retail and Food & Beverage Sectors by Regions (Per Cent of January 2020 levels)
Per Cent of Jan-20 Retail Per Cent of Jan-20 Food & Beverage
CB P2&3 HA SP CB P2&3 HA SP
150 4Q22 average: 122 150
4Q22 average: 114
120 120
90 4Q22 average: 118 90

4Q22 average: 101
60 60
30 30
0 0
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22
Downtown Heartlands Overall Downtown Heartlands Overall
Notes: Graphs plot the 7-day moving averages of indices of nominal spending at Singapore-based merchants, obtained from a payment provider network. The baseline of
100 represents the average day-of-week spending in January 2020. CB stands for Circuit Breaker, P2&3 HA stands for Phase 2 and 3 Heightened Alert, and SP stands for
Stabilisation Phase.
Shift of Spending to Online Channels
The pandemic has also led to a substantial shift in spending from physical to online channels, when compared to pre-
pandemic trends (January 2020).
Notably, the proportion of online spending surged from pre-pandemic levels (January 2020) of 30 per cent for online
retail spending and 10 per cent for online F&B spending8, to a high of 60-70 per cent during the Circuit Breaker period
(Exhibit 3). A similar surge occurred for online F&B spending in particular during the Heightened Alert periods. With the
progressive easing of COVID-19 restrictions, the share of online spending had fallen to 40 per cent for retail spending
and 20 per cent for F&B spending by May 2022. While these levels were lower than the peaks seen at the height of
the pandemic during the Circuit Breaker period, they were still higher than the proportions of online spending seen
in the respective sectors before the pandemic in January 2020.
This observation is not unique to Singapore, as other countries such as New Zealand, United Kingdom and Australia
also recorded marked increases in their online spending proportions9 both during and after the pandemic. In Singapore,
the higher online spending proportion is also likely to have been supported by the Government’s effort to encourage
more Retail and F&B businesses to go online through programmes such as the Digital Resilience Bonus.
8 Online F&B spending refers to the purchase of F&B through a food delivery platform (e.g., Grab, Foodpanda, Deliveroo) or the F&B businesses’ websites or apps.
9 Survey of global consumer spending by Alcedo et al. 2022
Exhibit 3: Online Proportions of Spending in Retail and Food & Beverage Sectors (Per Cent)
Per Cent
CB P2&3 HA SP
80
70
60
50
40
30
20
10
0
Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 Jul-22 Oct-22
Retail Spending Index DOS's RSI F&B Spending Index DOS's FBSI
Notes: Solid lines plot the 7-day moving averages of the daily proportions of online spending at Singapore-based merchants, obtained from a payment provider network.
Dashed lines plot the monthly online proportion of spending, obtained from DOS. Blue lines represent retail spending and red lines represent F&B spending. CB stands for
Circuit Breaker, P2&3 HA stands for Phase 2 and 3 Heightened Alert, and SP stands for Stabilisation Phase.
Conclusion
Having emerged from the COVID-19 pandemic after more than two years, retail and F&B spending have rebounded
strongly, as can be seen from DOS’s RSI and FBSI, as well as newer spending indices derived from data from a
payment provider network. At the same time, there are also signs of a structural shift towards online spending, and
a redistribution of F&B spending share towards the heartlands.
The continued recovery of retail and F&B spending in the months ahead will be further supported by various initiatives
by the Government to improve the capabilities of Retail and F&B firms and expand their customer base. For example,
Enterprise Singapore is working with local merchants, through the Food Services and Retail Business Revitalisation
Package and Our Heartlands 2025 initiative, to attract more consumers into the heartlands. It is also deepening its
efforts to build digitalisation capabilities and enhance productivity among firms in the sectors.
While global macroeconomic uncertainties may dampen consumer sentiments in the near term, the prospects for
Singapore’s retail and F&B sectors remain positive given the continued recovery in tourism demand, resilient labour
market conditions and the Government’s continued commitment to upgrading the capabilities of our firms and workers
in these sectors.
Contributed by:
Mr Ong Chong An
Economist
Economics Division
References
De Fraja, G., Matheson, J., Mizen, P., Rockey, J., Taneja, S., & Thwaites, G. (2021). Covid reallocation of spending: The
effect of remote working on the retail and hospitality sector. Available at SSRN 3982122.
Barrero, J. M., Bloom, N., & Davis, S. J. (2021). Why working from home will stick (No. w28731). National Bureau of
Economic Research.
Alcedo, J., Cavallo, A., Dwyer, B., Mishra, P., & Spilimbergo, A. (2022). E-commerce during COVID: Stylized facts from
47 economies (No. w29729). National Bureau of Economic Research.
CHAPTER
ECONOMIC
7 OUTLOOK
Chapter 7
ECONOMIC
OUTLOOK
LEADING INDICATORS OUTLOOK FOR 2023
The composite leading index (CLI) for Singapore declined Since the Economic Survey of Singapore in November
by 3.9 per cent on a quarter-on-quarter basis in the fourth 2022, Singapore’s external demand outlook has improved
quarter of 2022, pointing to a weaker outlook for the slightly. Growth in China is projected to pick up in tandem
Singapore economy in the near term (Exhibit 7.1). with the faster-than-expected easing of its COVID-19
restrictions. This has led to improvements in the growth
Of the nine components of the CLI, seven of them decreased outlook of regional economies. At the same time, the global
on a quarter-on-quarter basis in the fourth quarter, namely supply situation continues to stabilise amidst softening
non-oil sea cargo handled, stock price, non-oil retained global demand conditions. Accordingly, global commodity
imports, money supply, US Purchasing Managers’ Index, prices have eased from 2022 levels, although they remain
stock of finished goods and domestic liquidity. By contrast, elevated with the ongoing Russia-Ukraine war.
the other two components – wholesale trade and new
companies formed – rose compared to a quarter ago. In the US, growth is projected to decelerate as tight financial
conditions on the back of monetary policy tightening
are expected to weigh on personal consumption and
Exhibit 7.1: Composite Leading Index Levels and Growth Rate investment. Similarly, notwithstanding improvements in its
energy situation, GDP growth in the Eurozone is forecast
2015 = 100 Per Cent
to slow as tighter monetary policy on account of elevated
114 10
core inflation is likely to dampen domestic demand.
112 5
QOQ Change In Asia, China’s growth is expected to pick up following
(RHS)
110 0 the lifting of its COVID-19 restrictions, although continued
108 -5
stresses in its property market and weakening global
demand are likely to weigh on its recovery. Meanwhile,
106 -10 despite weaker external demand for their merchandise
104 -15
goods and commodities, GDP growth in key Southeast Asian
economies such as Malaysia, Indonesia and Thailand is
102 -20 likely to be supported by a continued recovery in domestic
100
and tourism demand.
-25
98 -30 At the same time, uncertainties in the global economy

I II III IV I II III IV I II III IV I II III IV
2019 2020 2021 2022 remain. First, tighter financial conditions across many
advanced economies that have been raising interest
rates could have a larger-than-expected impact on global
growth. With major central banks still raising interest rates,
disorderly market adjustments and the exposure of latent
vulnerabilities among highly-indebted corporates and
households could increase financial stability risks. Second,
further escalations in the war in Ukraine and geopolitical
tensions among major global powers could worsen supply
disruptions, dampen consumer and business confidence,
as well as weigh on global trade.
Chapter 7: Economic Outlook 85
Against this backdrop, the growth outlook for aviation-

and tourism-related sectors of the Singapore economy
has improved, as the recovery in international air
travel and inbound tourism is expected to accelerate
following the faster-than-expected relaxation of China’s
border restrictions. These sectors include air transport,
accommodation and arts, entertainment & recreation.
The output of the aerospace segment within the transport
engineering cluster is also expected to be bolstered by
the improved outlook for air travel.
On the other hand, the growth outlook for other outward-

oriented sectors remains weak given the broader slowdown
in the global economy. For instance, the semiconductors
segment of the electronics cluster is expected to be
negatively affected by weaker global semiconductor
demand, while the precision engineering cluster is
projected to be weighed down by a cutback in capital
spending by semiconductor manufacturers. At the same
time, growth in the wholesale trade, water transport and
finance & insurance sectors will be dampened by the
slowdown in major external economies.
Taking into account the global and domestic economic

environment, the GDP growth forecast for 2023 is
maintained at “0.5 to 2.5 per cent”.
IMPACT OF THE JOBS
GROWTH INCENTIVE
FEATURE
ARTICLE (JGI) SCHEME ON
FIRM-LEVEL LOCAL
LABOUR OUTCOMES
Feature Article
IMPACT OF THE JOBS GROWTH

INCENTIVE (JGI) SCHEME ON
FIRM-LEVEL LOCAL LABOUR
OUTCOMES
OVERVIEW
As the economy began to recover from the pandemic-
induced recession, the JGI scheme was introduced to
support job creation through the use of wage support
to encourage firms to bring forward the hiring of
local workers.
FINDINGS
Finding 1: Finding 2:
The JGI scheme was associated with an increase in local The JGI scheme was also associated with an increase in
gross hires, although the impact waned over the three the average wages of local gross hires. Compared to the
phases. Compared to their respective control groups, JGI- respective control groups, the average wages of local hires
supported firms hired 47,000, 28,000 and 15,200 more local in JGI-supported firms were 12.1% to 13.6% higher during
workers in Phases 1, 2 and 3 respectively. These estimates the first three phases of the JGI scheme.
translate into a cumulative increase of about 90,200 local
hires for the period of September 2020 to February 2022.
PHASE 3
+15,200
local hires
PHASE 2
+28,000
local hires TOTAL PHASES 1 TO 3
IMPACT +12.1% TO +13.6%
+90,200 average wages of
local hires local hires
PHASE 1
+47,000
local hires
POLICY TAKEAWAY
Given that the JGI is an exceptional scheme designed to
support labour market recovery during crisis, its positive
effects on supporting local hires were the strongest as
the economy was emerging from the recession and when
labour market slack was the most severe. The JGI is
assessed to have achieved its objectives with the labour
market having largely recovered to pre-pandemic levels.
Feature Article 89
EXECUTIVE SUMMARY
In 2020, the onset of the COVID-19 pandemic caused the Singapore economy to plunge into its worst recession
since independence. To cushion firms and workers from the impact of the recession, the Government provided
broad-based cost relief to firms. However, as the economy began to recover from the recession, government
support measures started to tilt from providing cost relief to supporting the labour market recovery. Against
this backdrop, the Jobs Growth Incentive (JGI) scheme was introduced to support job creation through the
use of wage support to encourage firms to bring forward the hiring of local workers. This study evaluates
the effectiveness of JGI Phases 1 to 3 in supporting local employment outcomes.
Our findings suggest that JGI Phases 1 to 3 were successful in encouraging firms to expand their local
workforce, which in turn supported the labour market recovery. Between September 2020 and February
2022, the JGI scheme was associated with an increase of about 90,200 local hires cumulatively. At the same
time, local hires also benefitted from wages that were 12.1 per cent to 13.6 per cent higher on average.
Furthermore, there was evidence that in Phase 1, the scheme supported a modest increase in the hiring of
mature workers.
Given that the JGI is an exceptional scheme designed to support labour market recovery during a crisis,
its positive effects on supporting local hires were the strongest as the economy was emerging from the
pandemic-induced recession and when labour market slack was the most severe. As the economic recovery
gained momentum and labour market slack dissipated, the positive effect on local gross hires expectedly
waned. The JGI is assessed to have achieved its objectives with the labour market having largely recovered
to pre-pandemic (2019) levels1 by 4Q2022.
The views expressed in this paper are solely those of the authors and do not necessarily reflect those of the Ministry of
Manpower (MOM), Ministry of Finance (MOF), Ministry of Trade and Industry (MTI) or the Government of Singapore.2
INTRODUCTION
In 2020, the onset of the COVID-19 pandemic caused the Singapore economy to plunge into its worst recession since
independence. To help firms and workers cope with the economic shock, the Government provided broad-based cost
relief to firms. In particular, to safeguard the livelihoods of local workers, the Government implemented the Jobs
Support Scheme (JSS) which provided wage subsidies to employers to help them retain their local employees. This
helped to stabilise the labour market and mitigate the adverse impact on local employment and wages [Pang, Zhou &
Lee, 2022]. Nevertheless, given the severity of the economic downturn, the labour market still experienced negative
spillover effects as the resident unemployment rate rose above pre-pandemic levels and hiring sentiments weakened.
In the second half of 2020, as COVID-19 infections were brought under control following the Circuit Breaker, economic
activities slowly resumed with a careful and calibrated easing of domestic and travel restrictions. In tandem with the
recovery in economic activity, government support measures for firms began to pivot from providing cost relief to
supporting a labour market recovery. Against this backdrop, as the JSS support was gradually tapered, a new hiring
scheme – the Jobs Growth Incentive (JGI) – was introduced in September 2020 to encourage firms to bring forward
their hiring plans and expand their local workforce. The first phase of the JGI scheme provided support to eligible firms
who hired locals between September 2020 and February 2021. Since then, the scheme has been extended successively,
with a total of five phases to-date (the latest Phase 5 is from October 2022 to March 2023). This study focuses on the
impact of the first three phases of the JGI scheme based on data availability at the time of the analyses.
1 As at December 2022, total employment surpassed pre-pandemic levels by 3 per cent whereas the resident unemployment rate, at 2.8 per cent, was below the
pre-pandemic average resident unemployment rate of 3.0 per cent.
2 We would like to thank Ms Yong Yik Wei, Mr Kenny Tan, Dr Yip Chun Seng, Mr Tan Kok Kong, Ms Jamie Poh, Mr Alphonsus Gomez and Mr Lee Zen Wea for their
useful suggestions and comments. All errors belong to the authors.
In terms of scheme design, the JGI scheme provided wage support to firms for new local workers hired within a
qualifying window. To qualify for the support, firms must have increased both their overall local workforce, and the
number of local workers earning gross monthly wages of $1,400 and above, relative to the size of their local workforce
in the baseline months [Exhibit 1]. In this way, the JGI only supported firms that expanded their local workforce, which
was a more targeted approach as compared to the JSS. In addition, the JGI provided a higher level of wage support
for vulnerable workers, who were defined as mature workers (i.e., aged 40 years and above), persons with disabilities
(PwDs) and ex-offenders.
Exhibit 1: Scheme Details of JGI Phases 1 to 3
Phase 1 Phase 2 Phase 3
New local hires in September New local hires in March New local hires in October
2020 – February 2021 2021 – September 2021 2021 – March 2022
Qualifying window
Baseline month: Baseline month: Baseline month:
August 2020 February 2021 September 2021
1. Increase in overall local No change to conditions No change to conditions

workforce relative to 1 and 2. Baseline month 1 and 2. Baseline month
baseline month; and updated to February 2021 updated to September 2021
2. Increase in local
workforce earning gross Employer must be Employer must be
Eligibility conditions monthly wages of $1,400 established on or before 15 established on or before 23
and above relative to February 2021 September 2021
baseline month
Employer must be established

on or before 16 August 2020
Support for non-mature Up to 25% of first $5,000 of Up to 25% of first $5,000 of Up to 15% of first $5,000 of
workers wages for 12 months wages for 12 months wages for 6 months
For wages paid in September Up to 50% of first $6,000 of Up to 50% of first $6,000 for
2020 – February 2021, up to wages for 18 months 12 months
Support for mature 50% of first $5,000 of wages;
workers (aged ≥40), PwDs, for wages paid from March
ex-offenders 2021 onwards, up to 50% of
first $6,000 of wages. Support
was provided for 18 months.
As the resident unemployment rate began to fall in tandem with the economic recovery (i.e., from the pandemic peak of
4.7 per cent in September 2020 to 3.0 per cent in March 2022), the JGI support levels were reduced across the phases
to scale down the support in general, even while continuing to maintain higher support levels for vulnerable workers.
This study empirically examines the causal impact of the first three phases of the JGI scheme on the following
outcome variables: (a) the number of local gross hires3, which provides a measure of the effectiveness of the scheme
in incentivising the hiring of local workers, (b) the average wages of local gross hires, which is a proxy for the quality of
the jobs created for local workers, and (c) the share of local gross hires aged 40 and above, which examines whether
the higher level of wage support provided for mature workers was effective in incentivising employers to hire them.4
3 Local gross hires refer to the number of newly-employed locals who were not employed with the firm in the preceding month.
4 The findings for JGI Phase 1 were first released in MOF’s Paper on “Assessment of the Impact of Key COVID-19 Budget Measures” published in February 2022.
Feature Article 91
LITERATURE REVIEW
Hiring subsidies are commonly used to provide broad-based support for hiring during a recession as they lower the cost
of workers. The literature generally finds that hiring subsidies can improve employment outcomes during economic
downturns. For instance, evidence from France and the United States showed that hiring subsidies implemented during
and shortly after the 2007-2008 Global Financial Crisis had a strong impact on employment rates [Cahuc et al., 2017;
Farooq & Kugler, 2015]. Sjögren and Vikström (2015) also found that an increase in the wage subsidy rate in Sweden
in 2009, following the Global Financial Crisis, had a substantial impact on job finding rates, although an increase in
the subsidy duration had no effect.
Hiring subsidies are sometimes targeted at specific subgroups of workers, especially those who are more vulnerable,
to improve their employment prospects. However, empirical findings on the effectiveness of such subsidies are mixed.
Grijalva and Neumark (2013) found that state-level hiring subsidies targeted at unemployed jobseekers in the United
States had a large impact on employment, while Desiere and Cockx (2022) concluded that a hiring subsidy targeted
at mature workers in Belgium successfully increased the job-finding rates of these workers. On the other hand,
Boockmann et al. (2012) found that overall, there was little evidence5 that hiring subsidies targeted at mature workers
in Germany incentivised firms to hire more mature workers.
DATA AND SUMMARY STATISTICS

This study uses monthly administrative data on local employees and foreign work pass holders, as well as JGI payout
data, which include data on the number of new local hires. The administrative datasets on local and foreign workers
cover the period of June 2020 to February 2022, while the JGI payout data cover the period of September 2020 to
February 2022.6 Over the latter period, around 81,200 unique firms received JGI disbursements for making approximately
860,500 new local hires [Exhibit 2].
Exhibit 2: Number of JGI-Supported Firms^ and Hires, by JGI Phases*
Number of JGI Supported Firms Number of JGI Supported Hires
Phase 1 42,500 Phase 1 305,200
Phase 2 41,500 Phase 2 309,900
Phase 3 34,800 Phase 3 245,400
^ These are not unique firm counts as the same firm can be supported in different JGI phases.
* The statistics on JGI-supported firms and hires are for the full six months of Phase 1, the first six months of Phase 2 (out of seven months), and the first five months of
Phase 3 (out of six months). These correspond to the time periods for the three phases analysed in this study, which were in turn based on data availability at the point
when the analyses were carried out.
Source: MOM.
5 The study found positive effects for only one sub-group of mature workers with no effect for the rest.
6 JGI Phase 1 was implemented in September 2020, but data from June 2020 was used in identifying an appropriate control group for the analysis. While JGI Phase
3 provided support for new local hires made from October 2021 to March 2022, data for March 2022 was unavailable when the analysis was conducted.
The JGI scheme supported the recovery of sectors adversely affected by the pandemic, such as Food & Beverage
Services and Retail Trade, as well as the expansion of growth sectors, such as Professional Services and Information &
Communications. These were the sectors with the largest number of JGI-supported hires for Phases 1 to 3 [Exhibit 3].
Exhibit 3: Top 5 Sectors with the Most Number of JGI-Supported Hires for Phases 1 to 3
Top 5 ITM Sectors With the Most JGI Supported Hires
140,000
120,000 114,500
100,000
80,000
65,100 62,300
55,800
60,000 47,000
40,000
20,000
0
Food & Beverage Wholesale Trade Professional Services Information & Retail Trade
Services Communications
Source: MOM.
The JGI scheme also supported the hiring of vulnerable jobseekers. Among all JGI-supported hires across Phases
1 to 3, about 45 per cent were previously non-employed7, with close to 28 per cent having been non-employed for at
least six months [Exhibit 4]. Close to half of all JGI-supported hires were mature workers.
Exhibit 4: Distribution of Non-Employment Duration among JGI-Supported Hires for JGI Phases 1 to 3
Length of non-employment before hired for JGI-supported job
6 months or longer, 28%
Previously employed, 56%
Less than 6 months, 16%
EMPIRICAL METHODOLOGY
To estimate the causal impact of the JGI scheme on key firm-level local worker outcomes, we compared the outcomes
of two groups of firms: a first group that received the JGI subsidy in any given month of the qualifying window (i.e.,
the “treated” group); and a second group that did not receive the JGI subsidy during the qualifying window (i.e., the
“control” group)8. The local worker outcomes in the control group would serve as a counterfactual for the treated
group, thereby allowing us to estimate the causal impact of the scheme. The analysis was conducted separately for
each JGI phase as the scheme parameters differed across the phases.9
7 Individuals were defined as non-employed based on CPF administrative records, i.e., if they do not have any CPF contributions paid for him/her by an employer.
8 For example, a firm that hired a local worker during the qualifying window but did not register an increase in its overall local workforce relative to the baseline
month would not have received the JGI subsidy.
9 For the analysis of JGI Phases 2 and 3, firms that had received support under the earlier JGI phases were excluded from both the treated and control groups as their
employment outcomes could be confounded by continued impact from the earlier JGI phases.
Feature Article 93
However, across the three phases, the treated firms were observably different from firms in the control group in
the three months prior to the qualifying window of the respective JGI phases [Exhibit 5]. A simple comparison of the
outcomes of the two groups of firms could therefore be confounded by the underlying differences in these observable
characteristics. To improve the comparability of the two groups, we (a) restricted the control group to firms that made
at least one local gross hire during the qualifying window but did not meet the other JGI criteria, and (b) ran a matching
algorithm known as Coarsened Exact Matching (CEM) based on firms’ characteristics in the three months prior to
the qualifying window of the respective JGI phases. This allowed us to construct control groups that were observably
more similar to the treated firms in terms of their workforce profiles and sectors (henceforth “the matched treated
and control groups”) for the respective phases.
Exhibit 5: Summary Statistics of Firm Characteristics Before and After Matching
Firm statistics Before Matching After Matching

(Average) Treated Control Treated Control
Phase 1 (Using data from June 2020 to August 2020)
Number of local workers 27 9.4 13 14

Average wages of local
$3,600 $3,300 $3,200 $3,100
workers
Share of local workers aged
63% 70% 74% 72%
40 and above
Number of local gross hires 1.3 0.35 0.35 0.34
Phase 2 (Using data from December 2020 to February 2021)
Number of local workers 18 13 9.0 9.7

$4,500 $3,800 $3,600 $3,500
workers
67% 67% 76% 76%
40 and above
Phase 3 (Using data from July 2021 to September 2021)
Number of local workers 11 14 6.8 7.2

$3,900 $3,500 $3,300 $3,100
workers
74% 67% 81% 80%
40 and above
Source: Authors’ estimates.

Thereafter, we quantified the impact of the JGI scheme using a difference-in-differences regression model, which
estimates the difference between the change in the trends of the matched treated and control groups. Specifically,
the following equation was estimated:
Y𝑖t = β1 + β2T𝑖 ⨉ Dt + δst + α𝑖 + ε𝑖t
Where:
• Y𝑖t denotes the outcome of interest (i.e., number of local gross hires, log of average wages among
local gross hires, share of local gross hires aged 40 and above) for each firm 𝑖 in time t
• T𝑖 is the treatment dummy (equals to 1 if the firm had received JGI for any given month during the
respective qualifying period, 0 otherwise)
• Dt is a monthly time dummy (excluding the baseline month: August 2020 for Phase 1, February 2021
for Phase 2, and September 2021 for Phase 3)
• δst refers to sector x time fixed effects to control for sector-specific time trends
• α𝑖 refers to firm fixed effects
• ε𝑖t refers to the error term
The coefficient of interest is β2, which measures the average impact of the JGI scheme on firm-level local worker
outcomes.
The regression model controls for the influence of broader (non-JGI) macroeconomic and sector-specific trends that
are common to both the treated and control groups (e.g., the uneven impact of the COVID-19 pandemic on different
sectors). However, the identification strategy may still overestimate the impact of the JGI scheme on local hiring, as
this outcome variable is positively correlated with assignment to the treated group. Specifically, as firms would need
to register a net increase in their local workforce relative to the baseline month to qualify for JGI, the treated firms
are by construct likely to have hired more local workers relative to the control group. Furthermore, as eligible firms
are those that hired locals more extensively than firms in the control group, the two groups of firms are likely to be
different in unobservable ways, which could bias the estimated impact. Nevertheless, our approach mitigates these
biases by (a) examining the impact of JGI on local gross hires instead of local net hires, as the former is not perfectly
correlated with the qualifying criteria, and (b) improving the comparability of the two groups by constructing a control
group that comprises firms that are more similar to those in the treated group in the ways described earlier.
To ensure the robustness of our findings, we conducted additional checks. For example, we used a different matching
method (propensity score matching) and lifted the restriction that control firms needed to have hired at least one local
worker. The results from these robustness checks were similar to our main results.
RESULTS
We find that the JGI scheme improved local employment outcomes modestly across all three phases [Exhibit 6].
First, we find that the JGI scheme was associated with an increase in local gross hires, although the impact waned
over the three phases. Specifically, compared to their respective control groups, JGI-supported firms hired 0.30, 0.18
and 0.14 more locals per firm per month in Phases 1, 2 and 3 respectively. These estimates translate into a cumulative
increase of 47,000 and 28,000 local hires across Phase 1 (six months) and the first six months of Phase 2 respectively,
as well as a cumulative increase of 15,200 local hires over the first five months of Phase 3.
Second, we find that the scheme was associated with an increase in the average wages of local gross hires. Compared
to the respective control groups, the average wages of local gross hires in JGI-supported firms were 13.3 per cent
(which translates to approximately $260), 13.6 per cent (or $330) and 12.1 per cent (or $300) higher in Phases 1, 2 and
3 respectively. The positive impact on average wages could be due in part to firms having to meet the JGI eligibility
criterion of expanding their local workforce paid a monthly wage of at least $1,400.
Feature Article 95
Exhibit 6: Impact of the JGI on Firm-level Local Employment Outcomes, by JGI Phase
Estimated Average Impact for:
Outcomes Examined Phase 1 Phase 2 Phase 3

September 2020 – March 2021 – October 2021 –
February 2021 August 2021^ February 2022^
Change in number of local gross hires
0.3 count*** 0.18 count*** 0.14 count***
per firm per month
Average wages of local gross hires at the
13.3%*** 13.6%*** 12.1%***
firm level
Share of mature workers (aged 40 &
above) among local gross hires at the 1.9%-pt** 0.6%-pt 0.7%-pt
firm level
^ The analysis for Phase 2 did not cover September 2021 while the analysis for Phase 3 did not cover March 2022 as the JGI payout data for these months were not
available at the time when the respective analyses were conducted..
Source: Authors’ estimates.
Third, we find a modest positive impact on the share of mature workers among local gross hires. In Phase 1, JGI-
supported firms registered a 1.9 percentage-point increase in the share of mature workers hired compared to their
control group. This increase was largely driven by strong hiring effects in the first month following the implementation
of JGI Phase 1. The effects were positive but statistically insignificant in Phases 2 and 3.
CONCLUSION
The findings of our study suggest that JGI Phases 1 to 3 were successful in encouraging firms to expand their local
workforce, which in turn supported the recovery of the labour market from the effects of the pandemic. Between
September 2020 and February 2022, the JGI scheme was associated with an increase of about 90,200 local hires
cumulatively. At the same time, local hires also benefitted from wages that were 12.1 per cent to 13.6 per cent higher
on average. Furthermore, there was evidence that the scheme supported a modest increase in the hiring of mature
workers in Phase 1.
Given that the JGI is an exceptional scheme designed to support labour market recovery during a crisis, its positive
effects on supporting local hires were the strongest as the economy was emerging from the pandemic-induced recession
and when labour market slack was the most severe. As the economic recovery gained momentum and labour market
slack dissipated, the positive effect on local gross hires expectedly waned. The JGI is assessed to have achieved its
objectives with the labour market having largely recovered to pre-pandemic (2019) levels by 4Q2022.
Contributed by:
Mr Alex Cheng, Principal Research Analyst

Manpower Planning and Policy Division (Economics Unit)
Ministry of Manpower
Mr Eugene Zhou, Senior Economist

Manpower Planning and Policy Division (Economics Unit)
Ministry of Manpower
(formerly)
Ms Glenvicia Sim, Economist

Economic & Fiscal Analysis Directorate
Ministry of Finance
Mr Jonathan Khoo, Economist

Economics Division
(formerly)
REFERENCES
Boockmann, B., Zwick, T., Ammermüller, A., & Maier, M. (2012). “Do Hiring Subsidies Reduce Unemployment Among
Older Workers? Evidence from Natural Experiments.” Journal of the European Economic Association 10: 735-764.
Cahuc, P., Carcillo, S. & Le Barbanchon, T. (2014). “Do Hiring Credits Work in Recession? Evidence from France.” IZA
Discussion Paper No. 8330.
Desiere, S. & Cockx, B. (2022). “How Effective are Hiring Subsidies to Reduce Long-Term Unemployment Among
Prime-Aged Jobseekers? Evidence from Belgium.” IZA Discussion Paper No. 14767.
Farooq, A. & Kugler, A. D. (2015). “What factors contributed to changes in employment during and after the Great
Recession?” IZA Journal Labor Policy 4, 3.
Grivalja, D. & Neumark, D. (2013). “The Employment Effects of State Hiring Credits” IZA Discussion Paper No. 9146.
Pang, J., Zhou, E., & Lee, T. M. (2022). “Feature Article: Impact of the Jobs Support Scheme on Labour Market Outcomes.”
Economic Survey of Singapore 2021: 86-93. Singapore: Ministry of Trade and Industry.
Sjögren, A. & Vikström, J. (2015). “How long and how much? Learning about the design of wage subsidies from policy
discontinuities” Labour Economics, 34, 127-137.
Singapore Ministry of Finance (2022). “Assessment of the Impact of Key COVID-19 Budget Measures.”
Feature Article 97
MINISTRY OF TRADE AND INDUSTRY
100 High Street, #09-01 The Treasury
Singapore 179434
ISSN 2382-6541

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ECONOMIC

Ministry of Trade and Industry

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02 Main Indicators of the

14 CHAPTER 2 70 6.9 Finance & Insurance

76 BOX ARTICLE 6.1

88 Impact of the Jobs Growth Incentive

2021 2021 2021

STRUCTURE OF THE ECONOMY IN 2022 (% OF NOMINAL VA)

LABOUR MARKET COST PRICES

Overall Unit Business Cost Domestic Supply

Value-Added per Unit Labour Cost Singapore Manufactured

MERCHANDISE TRADE SERVICES TRADE

$614,081 $709,967 $358,081 $401,544

+19.1% +15.6% +21.2% +12.1%

Merchandise Imports Services Imports

$545,882 $655,436 $326,233 $356,543

+20.4% +20.1% +11.6% +9.3%

53.6% 28.1% 18.4% 34.9% 28.7% 13.7% 8.0% 4.2%

Top Trading Partners in 2022 Top Trading Categories in 2022

Exports $88.2b Exports $140.0b

Exports $71.1b Exports $115.1b

Exports $61.8b Exports $54.9b

0.6% 0.5% 0.5%

INCOME COMPONENTS OF GDP IN 2022 SOURCES OF GROWTH IN 2022

OVERALL PERFORMANCE The services producing industries collectively grew by

Retail Trade 8.4 Wholesale Trade 0.4

Professional Services 7.6 Real Estate 0.4

Construction 6.7 Professional Services 0.3

Administrative & Support 6.6 Administrative & Support 0.3

Other Services Industries 5.2 Information & Comms 0.3

Overall GDP Growth 3.6 Transportation & Storage 0.2

Finance & Insurance 1.4 Accommodation 0.0

Accommodation 0.5 Finance & Insurance 0.0

Contribution to Growth Exhibit 1.4: Percentage-Point Contribution to Growth in Real

SOURCES OF GROWTH Domestic Demand

External demand shrank by 7.0 per cent year-on-year in

Gross Fixed Capital Formation INCOME COMPONENTS OF

Exhibit 1.7: Annual Changes in Gross Fixed Capital

Construction & Works -0.5 0.4 -1.0

Transport Equipment 1.0 -21.0 2.4 NATIONAL SAVING

Total 1.6 -0.3 1.9

Construction & Works -0.2 0.1 -0.3

Transport Equipment 0.1 -0.1 0.2

Machinery & Equipment 1.3 -0.3 1.7

Based on the Department of Statistics’ Survey of Singapore’s 20

VA per Actual Hour Worked

SECTORS WITH THE HIGHEST UNEMPLOYMENT

+15.5% +12.8% +7.4%

Real Estate Food & Beverage Retail Trade 2.1% 2.9%

ANNUALISED Per Cent Per Annum Real median gross monthly

EMPLOYMENT By broad sectors, employment rose in the services (+35,500),

Retail Trade 5.9

Transportation & Storage 2.0

40 Wholesale Trade 0.8

Administrative & Support 0.4

PRODUCTIVITY Exhibit 2.5: Changes in Value-Added per Actual Hour

Real Value-Added per Actual Hour Worked

Professional Services 2.2

76 BOX ARTICLE 6.1