Singapore, a global hub for finance and trade, has seen its digital economy undergo a remarkable transformation in recent years.
The inaugural Singapore Digital Economy (SGDE) report, a collaborative effort by the Infocomm Media Development Authority (IMDA) and the Lee Kuan Yew School of Public Policy, sheds light on the astounding growth of Singapore’s digital landscape. Here are the key findings and insights from the report:
Explosive Growth in Digital Economy
According to the report, in 2022 Singapore’s digital economy contributed a staggering 17.3% of the country’s Gross Domestic Product (GDP), marking a substantial increase from 13% in 2017. This impressive growth reflects the doubling of its value-added (VA) from S$58 billion to S$106 billion over the five-year period.
The report highlights the robust expansion of Singapore’s digital economy, which defies international standards and benchmarks.
The SGDE report takes a comprehensive approach to define Singapore’s digital economy, comprising two components:
- Information & Communications (I&C) Sector: The I&C sector, a key driver of Singapore’s economy, accounted for S$33 billion and 5.4% of the overall GDP in 2022, up from S$19 billion and 4.3% of GDP in 2017. It emerged as the fastest-growing sector during this period.
- Digitalization Across Other Sectors: Digitalization across the rest of the economy progressed at a robust rate, contributing S$73 billion or 11.9% of Singapore’s GDP in 2022, compared to S$39 billion or 8.7% of GDP in 2017. This growth outpaced the overall economic expansion.
Small and Medium Enterprises (SMEs) Embrace Technology
The report highlights the significant role of digitalization in Singapore’s economy. The adoption rate of technology among Small and Medium Enterprises (SMEs) surged from 74% in 2018 to an impressive 94% in 2022. Moreover, the average technology adoption intensity by SMEs increased from 1.7 to 2.1 over the same period, indicating a growing reliance on digital solutions.
Rising Demand for Tech Professionals
The demand for tech professionals in Singapore has soared.
- Between 2017 and 2022, the number of tech jobs grew from approximately 155,500 to around 201,100, representing an increased share of total employment from 4.2% to 5.2%. Surprisingly, over half of these tech jobs (around 57%) came from sectors beyond the I&C sector. This rising demand has benefited locals, with more than 70% of tech jobs held by Singaporeans and Permanent Residents.
Competitive Compensation for Tech Professionals
Tech professionals in Singapore enjoy competitive wages, with a resident median monthly wage of S$7,376, compared to the overall residents’ median wage of S$4,500.
This compensation reflects the country’s commitment to attracting and retaining top talent in the digital field.
Mr. Lew Chuen Hong, Chief Executive of IMDA, emphasized the significance of Singapore’s digital transformation and its impact on the nation’s economy. He stated, “We will continue to develop our I&C sector and drive digitalization across the rest of the sectors to ensure our enterprises and workforce remain competitive amid an increasingly digital world. In the digital domain where many of the constraints that bind us as a small country do not exist, there is much scope for Singapore to punch above our weight and be a much bigger digital red dot.”
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