SINGAPORE — Productivity growth in Singapore has recovered momentum this year after languishing in the past few years, with more firms tapping various government schemes to overcome the pains of economic restructuring.

“Productivity growth this year has been averaging at about 0.8 to 0.9 per cent for the first two quarters. We expect this to be maintained, so we can hope to see productivity growth at about 1 per cent this year,” said Minister for Trade and Industry Lim Hng Kiang yesterday in Parliament.

Mr Lim gave the latest update on the progress of the productivity push in his answer to questions from Jurong GRC Member of Parliament (MP) DavidOng. Productivity growth was flat last year after falling 2 per cent in 2012.

To date, more than 17,000 Singapore firms have benefited from productivity initiatives under the National Productivity and Continuing Education Council, such as the Productivity and Innovation Credit scheme, which had paid out S$1.5 billion in cash and tax savings as of Feb 28, said Mr Lim. More than 2,700 Innovation and Capability Vouchers were also awarded between March 1 and June 13.

Mr Lim’s remarks yesterday followed comments from economists that restructuring woes had hurt businesses and the prospects of economic growth. Bank of America Merrill Lynch’s economist Chua Hak Bin, who voiced a similar concern last week, said the latest productivity growth offered hardly any comfort.

“One per cent productivity growth this year is decent, but is still far below the 2 to 3 per cent official target. After four years, we are still not seeing the leap in productivity gains that are supposed to partly make up for the loss of manpower,” he told TODAY. “It begs the question of whether the exercise is worth a pause. I’m not advocating a U-turn, but I believe we can at least, for instance, review the structure of foreign worker levies.”

CIMB economist Song Seng Wun said while the latest productivity gains were at least a step in the right direction, certain sectors would need to step up their efforts. “So far, the bulk of productivity gains are coming from the goods-producing sectors, while services are still lagging behind … For us to achieve the official productivity growth target by 2020, we need to see more broad-based improvements, particularly from services.”

The retail as well as food and beverage sectors saw productivity drop by 2.1 per cent and 0.6 per cent per year respectively between 2010 and 2013, Mr Lim said, but added that the situation is improving as the take-up rate of productivity schemes continues to rise.

Despite the short-term pains, restructuring must go on and more can be done, said Mr Lim. “We must continue to press on with our restructuring drive. We have the capacity to fund more productivity improvement projects and (I) hope more firms will step forward to tap the various schemes.”