14 January 2013
SMEs expect labour to push business cost up: survey
SINGAPORE: Nine in 10 small and medium enterprises (SMEs) surveyed by the Association of Small and Medium Enterprises (ASME) expect labour to push costs higher.
And many are now setting their sights to overseas expansion, particularly in Iskandar, Malaysia.
Over 80 per cent of business owners who took part in the SME Business and Budget 2013 Sentiments survey say manpower, followed by rental and foreign worker levy contributed to higher business costs in 2012.
As such, over 60 per cent of respondents are looking to receive more incentives in Budget 2013.
These are in the areas of hiring local staff and talents, as well increasing productivity through the extension of the Productivity Innovation Credit (PIC) Scheme until 2015.
ASME is also proposing an increase of cash payout to 80 per cent for up to S$200,000. It is higher than the current from 60 per cent for S$100,000 of qualifying expenditure.
ASME said 2013 will be even more challenging if current issues are not resolved.
"In the short run, most SMEs will face greater impact on their profit margins and bottom line. The way forward would be to help SMEs speed up productivity improvements and assist SMEs to find alternative solutions to cope with the current unfavourable challenges and measures," said ASME president Chan Chong Beng.
ASME said it plans to set up a one-stop centre in Iskandar to assist in getting business licences, finding suitable properties and sourcing manpower.
- Source: ChannelNewsAsia