Singapore employers willing to pay premium for AI skills amid softer hiring sentiment: survey

[SINGAPORE] Singapore employers are scaling back headcount growth projections for the third quarter of 2026, with local hiring sentiment dropping to its lowest since late 2021.

However, the majority of firms are willing to pay a premium for artificial intelligence and critical thinking skills to drive productivity, according to a survey released on Tuesday (Jun 9).

ManpowerGroup’s latest quarterly Employment Outlook Survey found that the net employment outlook (NEO) among 599 employers in Singapore stood at 13 per cent for Q3.

This figure represents an 11-point decline on both the quarter and the year, marking the softest hiring forecast since Q4 2021 when the outlook was negative 2 per cent.

The indicator is calculated by subtracting the percentage of employers who anticipate reductions to staffing levels from the percentage of those who plan to hire.

At 13 per cent, Singapore’s Q3 net hiring expectations were below the global average of 26 per cent and the Asia-Pacific regional average of 28 per cent.

The survey found that 35 per cent of Singapore employers plan to increase headcounts between July and September; 41 per cent expect no change; and 22 per cent anticipate staff reductions.

The remaining 2 per cent of respondents were uncertain.

Among those who intend to maintain current staffing levels, 38 per cent said their existing headcount was sufficient to meet business goals.

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The second-most cited reason – mentioned by 27 per cent – for keeping staffing levels unchanged is waiting for economic changes before making new hiring decisions.

Linda Teo, country manager of ManpowerGroup Singapore, said: “Employers in Singapore are taking a more cautious approach to hiring this quarter, with many choosing to hold steady on headcount until there is greater clarity on geopolitical conditions.”

She added that hiring decisions are becoming more selective and deliberate, with investments directed towards high-impact skills.

By industry, the manufacturing sector led local hiring intentions with a 25 per cent NEO, despite slipping one point quarter on quarter and two points year on year.

Conversely, hiring sentiment in the information sector declined sharply, falling 34 points from the previous quarter to 7 per cent.

Tech and IT services held stable with NEO at 18 per cent.

Salary premiums for AI and soft skills

Amid the broader slowdown in headcount growth, companies are adopting a “skills-based approach to hiring”, noted Teo.

When it comes to demand for technical talent, AI capabilities emerged on top. Sixty-six per cent of Singapore employers said they would pay a premium for AI literacy skills, such as using AI tools.

Sixty-four per cent reported a willingness to pay more for AI model and application development skills, while 56 per cent cited traditional IT and data skills.

The firms most willing to pay a premium for AI literacy are those in the public sector, health and social services (78 per cent); professional, scientific and technical services (72 per cent); and tech and IT services (69 per cent).

For AI model and application development, the most willing employers are in information (76 per cent); professional, scientific and technical services (76 per cent); and finance and insurance (71 per cent).

Employers value interpersonal and soft skills, too, with 66 per cent saying they would pay more for critical thinking and problem-solving.

Equally, 66 per cent of the respondents were willing to pay a premium for communication, collaboration and teamwork.

Leadership and social influence capabilities followed closely, at 64 per cent.

Globally, the survey polled more than 40,500 employers across 42 markets and found an overall average NEO of 26 per cent.

India and Puerto Rico reported the strongest hiring sentiments worldwide, at 48 per cent each.

Within the Asia-Pacific, Hong Kong had the most cautious forecast, dropping 20 points quarter on quarter and 17 points year on year to an outlook of negative 9 per cent.