Rebound of Retail and Hospitality Sectors since Start of 2022

10 Mr Desmond Choo asked the Minister for Trade and Industry (a) how much have the retail and hospitality industries rebounded since the start of 2022; (b) what is the Ministry's forecast for the growth in these two industries for the next 12 months; and (c) what are the adaptations made to the respective Industry Transformation Maps for these two industries to incorporate resilience against future pandemics.

The Minister of State for Trade and Industry (Ms Low Yen Ling) (for the Minister for Trade and Industry): Mr Speaker, Sir, total retail sales, excluding motor vehicles, in July 2022 were about $3.4 billion, which is an increase of about 18% year-on-year. Hotel room revenue in July 2022 was about $319 million and this is an increase of four and a half times year-on-year. So, both sectors, the retail and the hospitality sectors, have recovered to comparable levels in 2019 before the COVID-19 pandemic, with retail sales even exceeding 2019 levels.

The recovery was bolstered by the healthy rebound in travel, with 1.5 million visitor arrivals in the first half of this year, which is nearly 12 times more than the same period in 2021. We expect the recovery to continue, though global geopolitical tensions and economic slowdown may slow this recovery.

The pandemic has been a severe stress test for many sectors. The 23 Industry Transformation Maps (ITMs) are being refreshed and updated to incorporate insights gleaned from the pandemic and to address new challenges and also to seize opportunities arising from it.

Specifically, the retail and hotel ITMs will need to ensure that the sectors' manpower, supply chains, operations and revenue streams become more resilient against pandemics and other disruptions. The ITMs will also aim to boost the abilities of our companies to seize new opportunities in the digital and sustainable space. More details will be announced when we launch the retail and hotel ITMs later this year.

Mr Speaker: Mr Desmond Choo.

Mr Desmond Choo (Tampines): I would like to thank the Minister of State for her reply. I have two supplementary questions. It is very encouraging to see the recent improvement in these two sectors. Will the Minister of State be able to share more on the depth and quality of the improvements? Second, while these two sectors are doing better, they still struggle with manpower. So, what will be the plans to attract more workers into these sectors?

Ms Low Yen Ling: Mr Speaker, I would like to thank the Member, Mr Desmond Choo, for his two supplementary questions. Indeed, both the retail and hospitality sectors, like I mentioned in the answer earlier, have experienced a rebound and recovered to pre-pandemic levels. Of course, we still have to monitor the global development and situation, especially the very volatile geopolitical tensions.

I mentioned earlier that, this year, we had 1.5 million visitor arrivals in the first half of 2022. STB projected that we should welcome four to six million visitor arrivals for the whole year in 2022. This augurs well, not just for the retail and hospitality sectors, but also food services sector.

The Member asked for some numbers. Let me share that we asked the hotel sectors and, in July this year, we understand that the average room rates for hotels reached higher than pre-COVID-19 levels at $259, compared to $94 in 2019 before COVID-19. And the average occupancy rate of hotels has risen to about 79% in July 2022 verses 58% a year ago.

For the retail sector, we track the numbers very closely. The total retail sales this year from January to July, over seven months, have averaged about $3.3 billion per month. What is very noteworthy is that $3.3 billion per month is comparable to the per month average of about $3.2 billion dollars in 2019, which was pre-COVID-19.

So, like what Mr Desmond Choo has mentioned, the retail, hospitality and food services sectors were the sectors hardest hit by the pandemic, including the aviation sector as well. The retail and hospitality sectors have shown incredible resilience and grit. The improvements that we are seeing today are really hard-won by the retail and hospitality sectors – and to a certain extent, the food services sector – in terms of their determination to adapt, transform, press on with digitalisation and do things very differently.

Allow me to use this platform to thank the trade associations and chambers (TACs). We have been working very closely with the TACs – for the hotel sector, it is the Singapore Hotel Association; for the retailers, it is the Singapore Retailers Association and, for food services, the Restaurant Association Singapore – to press ahead with productivity gain initiatives, with raising the innovation capacity and business transformation.

Having said that, having seen this rebound, it is important for companies in the retail and hospitality sectors to press on in their business transformation journey to be more productive, more competitive and more cost-efficient. And like what the Member had mentioned, not forgetting to upskill and reskill the workforce to stay resilient against disruptions.

To the Member's second question, how do we attract more Singaporeans to these sectors, we speak very regularly to the companies in the retail and hospitality sectors. We have tried different manpower and talent attraction initiatives. In order to attract more Singaporeans to the hospitality and retail sectors, we have been encouraging companies to redesign the jobs. And we do, in partnership with MOM, Workforce Singapore, e2i, create roles with larger, more meaningful work scopes, which can then offer better wages, higher salaries and very clear progression pathways.

In addition, they can also complement the job redesign with technology and digitalisation, to be more manpower-efficient.

We will continue to work with the companies in the retail and hospitality sectors to ensure that, moving ahead in the post-COVID-19 era, we are able to future-proof our companies and also workforce in these two sectors to be industry-relevant, future-ready and market-relevant.