The rising rent prices in Singapore seem to be taking a toll on employers and employees alike. A new study has found that many expats in Singapore are affected by dramatic rental hikes.
Employers of expatriate staff are also considering moving their operations overseas if this goes on. As rental for office spaces rise, businesses are also impacted.
The survey is conducted by the European Chamber of Commerce, Singapore (EuroCham).
Published on Monday (27 Mar), it looked into the extent and severity of the impacts of rising rental costs on businesses in Singapore.
Notably, the respondents said the most crucial factor that led to higher business operational costs here is the increased cost of employee housing rental.
Source: EuroCham
Half of the expat respondents who had to renew their lease this year or last faced a shocking rent hike of more than 40%. Another 36% of them had rents raised by between 20% and 40%.
Source: EuroCham
Three in five of those affected by rent hikes received aid of less than S$1,500 monthly, if any, from their companies. This means companies are not providing enough help despite the dramatic rent increase.
Source: EuroCham
Additionally, one in two employers has observed stress that negatively impacted employees’ work performance due to the volatile housing situation.
Rental costs for office spaces also went up, but not as much as for residential spaces. Most businesses only had their office rents raised by a maximum of 20%.
With the rising rents for both housing and offices, almost three-quarters of employers surveyed said they would be prepared to move their operations out of Singapore if this gets out of hand.
Source: EuroCham
The report says this situation is “unsustainable” in the long run.
If such costs continue rising without government intervention, Singapore will become less attractive to foreign companies. They can easily bring their businesses and offices to neighbouring countries, which might adversely affect Singapore’s economy.
The survey’s respondents comprised members of 14 European national business groups in Singapore, as well as the Singapore International Chamber of Commerce, the British Chamber of Commerce, and the Canadian Chamber of Commerce.
The 14 European national business groups are:
A total of 268 respondents across these business groups participated in the survey.
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Featured image adapted from 99.co.
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