AI boom pushes Singapore’s digital economy to SG$144.1b

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Singapore’s digital economy grew to SG$144.1 billion in 2025, accounting for 19.3% of the nation’s gross domestic product (GDP), up from 18.8% in 2024.

According to IMDA, the steady growth reflects that digital technologies continue to shape how all enterprises across various industries operate, and how workers do their jobs. The report highlighted that non-Information & Communications (non-I&C) sectors remain the dominant growth driver, contributing to more than two-thirds of Singapore’s digital economy.

The nominal value-added from digitalisation in the non-I&C sectors grew to SG$97.0 billion, representing a growth of 3.6% year-on-year. The Information & Communications (I&C) sector expanded to SG$47.1 billion, growing by 6.1% year-on-year in 2025.

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This expansion is reflected in tech employment, which grew 3.8% year-on-year to 222,200 in 2025. Growth is still led by non-I&C sectors at 5.3%, compared with 1.8% in the I&C sector, reinforcing that demand for tech talent is concentrated outside the tech industry.

Among the fastest-growing roles are those in AI and data and cybersecurity, areas where all enterprises have been increasing investment as they deepen their digital capabilities. Tech jobs also continue to offer strong wage outcomes, with the median monthly wage for resident tech workers at SG$8,000 in 2025, 60% higher than the overall resident median of SG$5,000.

Digitalisation remains near-universal, with 96.4% of all enterprises having adopted at least one out of six digital areas1 in 2025, up from 95.1% in 2024.

The digital adoption intensity, measured by the average number of digital areas adopted by SMEs out of the six areas, has also risen from 2.3 to 2.5.

The uptick in digital adoption intensity was partly driven by a greater share of non-SMEs and SMEs adopting digital areas such as cloud computing, data analytics, and AI.

AI adoption saw the most notable increase, with adoption rate for SMEs rising from 14.5% in 2024 to 23.4% in 2025, while that for non-SMEs increased from 62.5% to 70.4% over the same period.

Ng Cher Pong, chief executive, IMDA, said, “Singapore’s digital economy continues to demonstrate encouraging growth as both enterprises and workers embrace new solutions in their digital transformation journeys.”

Barriers to AI adoption

Despite the notable increase in AI adoption in recent years, a sizeable proportion of firms had yet to adopt AI.

Among these non-AI-adopting firms, the perceived lack of relevance due to small business scale remained the dominant barrier. The share of firms citing this as a reason for not adopting in 2025 was broadly similar to that in 2023.

On the other hand, fewer firms cited capability-related barriers such as readiness of IT infrastructure and skills to use AI between 2023 and 2025.

The heartening sign is that AI usage is accelerating among workers. Around 86% of workers use AI at work in 2026, up from 78% in 2025.

Among those AI users, 73% cited productivity improvements, 69% reported better work quality, and 68% noted stronger problem-solving capabilities. Workers are using AI across a broad range of workplace tasks.

Content creation remains the most common use case at 77%, followed by process automation at around two-thirds of workers, and data exploration and analytics at more than half.

Despite strong AI usage at work, a gap remains between workers' ambitions and their access to training. Around 68% of workers recognised a need to upskill or reskill in AI, but only 37% attended AI-related training in the past 12 months.

Workers who did not attend training pointed to a few common obstacles, around 35% said they were not nominated by their employers, a similar proportion cited a lack of time, and about one in four were unsure which course was right for them.

This suggests that clearer signposting and broader support for workers to take up suitable training could help more workers build relevant AI capabilities.

“IMDA remains committed to investing in continuous learning — equipping workers with practical, domain-specific AI skills — to ensure our workforce maintains Singapore’s competitive edge,” Ng said.