The Singapore Department of Statistics has revealed that the services sector is bracing for a less favourable business environment from April to September 2026. The Business Expectations Survey indicates that 13% of firms are optimistic, whilst 17% foresee deteriorating conditions, resulting in a net weighted balance of 4% expecting a downturn.
The survey, conducted from March to April 2026, highlights the impact of geopolitical tensions, including the US-Israel-Iran conflict, on business sentiment. The Food and Beverage Services industry anticipates a challenging period due to fewer festive events and rising prices, which are expected to kerb consumer spending. Similarly, the Transport and Storage industry is concerned about overcapacity and lower freight rates, further exacerbated by geopolitical issues.
Retail Trade also predicts a tough six months, with concerns over reduced tourism and consumer spending due to ongoing Middle East tensions. Conversely, the Wholesale Trade industry remains optimistic, driven by sustained demand for AI-related products. The Recreation, Community and Personal Services industry also expects growth, particularly in healthcare and childcare services.
Operating revenue for the sector is expected to decline slightly in the second quarter of 2026, with a net weighted balance of 1% predicting a downturn. Employment levels are anticipated to remain stable, with no net change expected. The survey results are crucial for informing government policy and business planning in Singapore.
