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The SME Scene in Singapore: How Are Companies Faring and What Jobs Are Out There?

Small and medium-sized enterprises (SMEs) form a majority of business in Singapore. While Covid-19 has certainly taken its toll on them, job opportunities still remain. Here’s what to look out for.

Covid-19 has been both boon and bane for Singapore’s small and medium-sized enterprises (SMEs) these past two years.

While many were hit with revenues plummeting in 2020, due to circuit breakers and social measures enacted to deal with the threat of the pandemic, many also took the opportunity to shift towards digitalisation and e-commerce.

In fact, according to Mastercard’s Recovery Insights report, the pandemic has actually created unexpected opportunities for our SMEs.

SMEs have gone “digital first”

David Mann, chief economist at Mastercard, said in a commentary to the Business Times: “It is no secret that the pandemic drove many businesses online as they tried to recoup losses from reduced patronage.

“However, our research found this was happening at a monthly rate of triple the pre-pandemic level. Additionally, we are seeing many new small businesses forgoing a physical presence altogether and minimising startup costs and risks by going ‘digital first’.

“In 2020, spending at Singapore’s non-CBD SMEs was at 104% of the 2019 level – healthy growth, given the circumstances.”

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There has been a growing optimism for business opportunities in 2022, according in late 2021.

It certainly helps that Singapore’s economy has been doing well, with gross domestic product growing 7.2% last year, rebounding from a 5.4% contraction in 2020.

However, one of the key challenges facing SMEs moving forward from the gloom of Covid-19 has been surprisingly, finding local workers to continue this pivot towards digitalisation.

In fact, the ratio of job vacancies to unemployed persons in 2021 reached a high of 1.63, according to Manpower Minister Tan See Leng in October, according to a report by the Straits Times.

“If vacancies are accumulating and they are left unfilled, it indicates that the labour market is having difficulty in accessing and finding the right talent for the vacancies”, he revealed.

SMEs mindsets need to change too

In addition, a report by training provider NTUC LearningHub released this month revealed seven in 10 of SMEs believe they need more support in upskilling their staff, with one in two citing a lack of budget as a key challenge as well.

However, the report also showed that 48% of employers surveyed think that sending workers to attend courses could be disruptive to their daily operations. That mindset will certainly need to evolve.

After all, talent acquisition and retention are still the biggest challenges faced by SMEs, according to a World Economic Forum report published in late 2021.

SMEs struggle to create appropriate development opportunities and career paths for their employees, making it difficult for executives to attract and keep talented employees, it revealed.

This could be why reports also found that both small and medium-sized enterprises have found it challenging attracting and retaining younger workers!

NTUC LearningHUB director of Infocomm Technology Anthony Chew said in a Straits Times report: “Being the key pillar of our economy, SMEs must also be proactive in the employability of their existing workforce to survive and thrive in a new world order.

“We stand ready to work with SME leaders to provide their workforce with outcome-focused training so that their workers are well-equipped with job-ready skills.”

The Big Picture for SMEs

Workforce Singapore (WSG) has partnered with the Singapore Business Federation to launch an Industry 4.0 Human Capital Initiative to encourage logistics and manufacturing SMEs to trial and adopt industry 4.0 technologies. As of 2021, close to 90 companies have come on board the initiative, with an additional 210 expected to do so by September 2022.

There are also programmes like the SME Digital Reboot by Ngee Ann Polytechnic and NTUC LearningHub in place, which have targeted to work with 500 SMEs to train workers in areas such as digital marketing and digital communication by the end of this year.

The Singapore government has also looked to bolster opportunities for local SMEs, launching negotiations and agreements with neighboring and regional countries such as Cambodia and South Korea in recent months, that will strengthen e-commerce and collaboration ties between our SME communities.

What does this all mean for jobseekers?

Well, it’s no surprise SMEs with e-commerce leanings will need to hire for those with digital marketing and sales experience and skillsets.

But one other industry that has flown under the radar somewhat is the sustainability sector, which includes the agri-tech and waste management industries.

It is expected to add 55,000 new and upgraded jobs in the next decade, said Minister for Sustainability and the Environment Grace Fu in a Straits Times report.

As it stands, banking, finance and insurance formed the third largest contributor to Singapore’s gross domestic product (GDP) in 2020, accounting for 15.7% of the total.

And the finance and insurance sector clocked in 9% growth in the third quarter of 2021, continuing its momentum from 9.8% in the previous quarter.

There will also be jobs in the information, communications and technology sector, and according to Minister for Communications and Information Josephine Teo, committed investments that Singapore’s Economic Development Board (EDB) secured in 2019 and 2020 could create close to 20,000 more digital jobs.

These will include roles in manufacturing, professional services, biomedical and other sectors that are pivoting towards digital services and skillsets.

SME jobs in the business and maintenance and repair services are also expected to grow in 2022, due to the rise of other business-to-business services, such as manufacturing services, telecommunications, computer and information services.

SMEs in these industries did strongly last year, according to OCBC’s SME Index, showing an 18% increase in collections year-on-year.

For both SME employers, employees and jobseekers, we’ve pulled together this guide of various relevant stories that will help you reach your business and career goals. Best of luck!

Turning Adversity into Opportunities: SMEs Navigating the #NewNormal

Why Now Is the Best Time for Singaporean SMEs To Embrace Tech 

What SMEs Could Do Beyond Temporary Crisis Management

How Can SMEs Survive the Coronavirus?

5 Employer Branding Strategies for SMEs That Don’t Cost a Bomb

Diversity in the Workplace: What SMEs Should Consider When Hiring

5 Must-have Free Digital Tools to Help Boost SME Productivity

Avoiding Retrenchment: How Singapore SMEs Can Reduce Manpower Costs

Manpower Woes: 5 Ways Singapore SMEs Can Better Manage Human Resources

5 Challenges Women SME Leaders Face and How to Overcome Them

5 Effective Strategies for SMEs to Hire Talented Employees

How Branding Gave My Company the Competitive Edge and Why Every SME Should Focus On It

3 SME Employee Perks That Won’t Negatively Affect Your Bottom Line

SMEs and the Talent Battle: Attracting and Retaining Gen Zs

4 Ways Singapore SMEs Can Attract and Retain Employees

Starting Your Career: Why You Should Consider SMEs as a Fresh Grad

Job Searching: How and Why You Should Consider Applying at SMEs

Flexi-work: Why It Works for SMEs

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