Four in 10 firms pessimistic about economy: survey

The proportion of companies expecting the economy to worsen over the next 12 months has nearly doubled.

Singapore businesses are growing more cautious about the economic outlook, with new data showing a sharp rise in pessimism across multiple sectors.

According to the Singapore Business Federation’s (SBF) National Business Survey 2025 – Singapore Budget Edition, the proportion of companies expecting the economy to worsen over the next 12 months has nearly doubled to 40% in Q1 2025 from 22% in Q4 2024.

The inaugural Business Sentiment Index (BSI), introduced in the report to measure business confidence across key indicators, stands at 56.5.

Sectors most concerned about near-term conditions include Hotels, Restaurants & Accommodations, Health and Social Services, and Retail Trade. The Hotels, Restaurants & Accommodations sector, in particular, recorded the lowest BSI score (52.2),

These concerns are compounded by rising operational costs. The average BSI cost expectation across all sectors was 68, with Real Estate and hospitality-related businesses seeing the highest cost pressure scores of 78.4 and 71.9, respectively.

The findings are based on responses from 526 businesses, collected between 27 March and 21 April 2025, with small and medium-sized enterprises making up 83% of the sample.

Despite the subdued sentiment, the report highlighted areas of resilience. Some sectors, such as Banking & Insurance and Education, displayed higher optimism across revenue, profitability, and business expansion indicators.

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