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Funding for tech tools tops Budget wish list of Singapore firms: SBF poll
SINGAPORE business owners want new government measures to support tech adoption, an annual industry survey has found.
More than three-fifths of firms polled said that support to get new, critical technologies was top of their wish list for the Singapore Budget 2019, according to the Singapore Business Federation’s (SBF) latest National Business Survey, whose findings were released on Thursday.
Also on the forefront of business owners’ Budget wishes were a relook of foreign manpower quotas (53 per cent), support for digital transformation (49 per cent), foreign worker levies (45 per cent) and lower compliance costs and regulatory fees (42 per cent).
Small and medium-sized enterprises (SMEs) are hoping for reprieve from business fees and rising interest rates too, with 71 per cent saying that more favourable financing mechanisms would benefit them the most.
The SBF survey found a lingering divide between how big companies and small businesses have responded to the call for innovation and to the Government’s roll-out of 23 Industry Transformation Maps (ITMs) in recent years.
While 64 per cent of large companies said that they have implemented business innovations, a smaller share of SMEs - 55 per cent - have done so.
Separately, a sizeable share of large companies believe that the ITMs, which were announced in the 2016 Budget, can help them with measures such as raising efficiency or productivity through technology, or improving their business models. Such goals were missing from SMEs’ priorities when it came to tapping opportunities from the ITMs.
Two-fifths of large businesses reported that they were implementing new technologies, beating the 31 per cent take-up rate at SMEs. On top of that, three-fifths of large companies said that they are making digital business capability development a priority - nearly double the share of of SMEs, or 33 per cent, that is hopping to this task.
And with many SMEs calling compliance costs a top challenge for businesses in Singapore, SBF chief executive Ho Meng Kit said in a statement: “SBF is working closely with the Pro-Enterprise Panel to streamline regulatory requirements and reduce compliance costs for our businesses.”
Mr Ho sits on the Pro-Enterprise Panel (PEP), a private-public group chaired by the head of the civil service, permanent secretary in the Prime Minister’s Office Leo Yip.
He told a morning briefing on Thursday that new areas of compliance have cropped up, such as data privacy, cybersecurity, and competition law. “These are fairly new and complex areas. For SMEs to understand them is a little harder,” he said.
As for how the SBF and PEP could work together to help SMEs address these issues, Mr Ho said: “The most important thing, really, is to reposition the PEP.
“I think it’s with extremely good intentions that the government set up the PEP, but it is not widely known, unfortunately... So, helping them in terms of rebranding, in terms of bringing more cases to the PEP, helping the Government to communicate better with the business community - I think these are things that we can do.”
Manpower challenges also remain a bugbear here, with half of the survey’s respondents citing rising labour costs as a problem.
Meanwhile, 41 per cent said that the availability of workers with appropriate tech know-how was a stumbling block in the push for innovation, while another 29 per cent fretted over retraining staff in digital skills.
But the SBF also flagged survey findings that suggest under-investment in staff training.
On average, 12 per cent of businesses said that they had put money into better training their current employees - a share that topped out at 19 per cent for the banking and insurance sector, and went to as low as 6 per cent in wholesale trade and just 4 per cent for other industries such as water and waste companies.
Mr Ho said that company representatives have told the SBF that they need help with both costs and skilled labour when it comes to implementing technology.
“What are the skills we are talking about? Digital skills: blockchain, AI (artificial intelligence), managing robotics, data management and all that stuff,” he said.
He also noted that SME sentiment for the next six months has dipped, with lower revenue and profit expectations. “SMEs do not see great growth, so because of that, they are not hiring.”
Overall, 38 per cent of businesses polled think that the business climate in Singapore will deteriorate in the coming year, up sharply from 21 per cent in the previous poll, while 46 per cent said it would stay the same.
Interest rates were the biggest fear, with 65 per cent of respondents expressing worry, but 61 per cent also pointed the finger at the ongoing United States-China trade war.
The SBF survey polled 705 companies between Sept 19 and Dec 7, 2018. Of these, 621 - or 88 per cent - were SMEs.