Singapore construction disrupted by manpower shortages and supply chain constraints

While a pipeline of projects is building up gradually, the Singapore construction industry is still facing significant manpower shortages, supply chain constraints, and escalating construction costs all attributable to the global pandemic. Meanwhile, productivity needs to further improve to meet this growing demand.

By Khoo Sze Boon, Managing Director – Singapore, Vietnam and Philippines and Cheryl Lum, Director, Head of Data and Research

Singapore’s economic outlook

The Singapore economy expanded by 1.3 percent in the first quarter of 2021, an improvement from the 2.4 percent contraction in the fourth quarter of 2020. The drivers of growth are mainly led by the manufacturing, finance and insurance and wholesale sectors. Performance of the construction sector continues to be weighed down by declines in both public and private sector construction works.

Construction sector performance

Current market sentiments, especially investments from the private sector, continue to appear low. It is anticipated that the public sector will continue to lead the majority of the work demand for the remaining quarters of this year.

Tender price escalation forecast

Tender prices are expected to remain volatile for the rest of 2021 as the construction industry faces significant manpower shortages, supply chain constraints and productivity concerns – resulting in higher labour and material costs for 2021/2022.

Download the report to see more economic data and insight, and to read about tender conditions in Singapore.

For further information contact:

Khoo Sze Boon
Managing Director – Singapore, Vietnam and Philippines