SINGAPORE, April 20 — Businesses in Singapore are tightening their belts as an energy shock linked to the Iran war drives up operating costs, with some firms freezing hiring and trimming staff benefits to stay afloat, a new survey has found.

According to a snap poll by the Singapore National Employers Federation (SNEF), and reported by The Straits Times today, 96 per cent of employers reported higher operating costs, with surging energy prices feeding through to utilities, fuel, raw materials and freight.

Nearly one in five firms said their costs had jumped by more than 25 per cent, while 41 per cent reported increases of between 11 and 25 per cent. The rest saw smaller rises of up to 10 per cent.

The squeeze is being felt across multiple fronts. More than half of respondents flagged manpower costs as a key concern, while higher utility and fuel prices are also pushing up expenses for supplies and logistics.

Sectors reliant on flexible staffing — including hospitality, food and beverage, and retail — are also grappling with rising temporary labour costs as businesses adjust to a more expensive operating environment.

Even so, most firms have held the line on jobs for now. The survey found that 83 per cent have not made changes to staffing levels or work arrangements.

Among those that have responded, the most common move has been to defer hiring or expansion plans, cited by 67 per cent. 

Others have redeployed or cross-trained staff, or reduced headcount through natural attrition, each at 33 per cent. 

About a quarter have cut bonuses, allowances and benefits, while roughly one in five have reduced working hours.

“These are largely calibrated responses aimed at managing costs while preserving jobs,” SNEF said.

The outlook, however, remains cautious. Some 39 per cent of employers expect conditions to worsen over the next six to 12 months.

Businesses are also bracing for further cost pressures from policy changes. Under Singapore’s Budget 2026, minimum qualifying salaries for foreign workers are set to rise from 2027, increasing the cost of hiring Employment Pass and S Pass holders.

SNEF chief executive Hao Shuo urged policymakers to take a flexible approach. 

“As the global economic situation remains quite fluid, we hope that the government will consider the prevailing economic conditions when implementing the earlier announced foreign manpower policy changes and also introduce a tiered level of support under the enhanced Progressive Wage Credit Scheme to help employers that are raising wages for their lower-wage workers,” he said.

Employers surveyed said financial support would be critical if energy prices remain elevated, with 83 per cent calling for tax relief or financing assistance. 

Others highlighted the need for energy subsidies and a delay in manpower policy changes that could add to cost burdens.

The poll, conducted between April 10 and 16, drew responses from 210 companies across sectors including finance, manufacturing, services and construction, most of them small and medium-sized enterprises.