The Singapore digital economy has grown to S$144.1 billion in 2025, accounting for 19.3 per cent of the country’s gross domestic product (GDP), as digital technologies such as AI transform how companies operate.
The figure is up from 18.8% in 2024, reflecting the growing importance of AI and related technologies, according to a report released this week by the Infocomm Media Development Authority (IMDA).
It found that growth was driven mainly by sectors outside the information and communications (I&C) industry. They contributed more than two-thirds of Singapore’s digital economy, with nominal value-added from digitalisation growing to S$97 billion, with a growth of 3.6 per cent year-on-year. The I&C sector expanded by 6.1 per cent year-on-year to reach S$47.1 billion in 2025.
As the economy faces disruption from AI, technology roles offered strong wage prospects. The employment for these positions also increased, growing 3.8 per cent year-on-year to 222,200 jobs in 2025.
Employment growth was stronger in non-I&C sectors, at 5.3 per cent, compared with 1.8 per cent in the I&C sector. IMDA said that it reinforces the point that demand for tech talent is concentrated outside the tech industry.
The fastest-growing roles, it noted, are in AI and data, as well as cybersecurity. This is happening as organisations continue to invest in digital capabilities.
Technology jobs also continue to offer strong wages, with the median monthly wage for resident technology workers at S$8,000 in 2025, a figure that is 60 per cent higher than the overall resident median wage of S$5,000.
In the same year, 96.4 per cent of all enterprises have adopted at least one of six digital areas: cybersecurity, cloud, e-payments, e-commerce, data analytics, and AI, up from 95.1 per cent in 2024.
Among small and medium-sized enterprises (SMEs) in the city-state, digital adoption intensity has also grown. This is measured by the average number of digital areas adopted by SMEs out of the six areas, which has risen from 2.3 to 2.5.
Growing AI adoption
In particular, AI usage is growing, including among smaller firms. Adoption among SMEs grew from 14.5 per cent in 2024 to 23.4 per cent in 2025. For large local enterprises, AI adoption increased from 62.5 per cent to 70.4 per cent.
The number of organisations that have not yet adopted AI but plan to do so in the next 12 months has more than doubled, growing from 5.6 per cent in 2023 to 12.1 per cent in 2025.
The report also found that two in five AI-adopting enterprises are either expanding deployment or have fully deployed or integrated AI across the organisation, suggesting that businesses are moving from experimentation to broader implementation.
Companies are adopting AI in different ways based on their resources and needs. Nearly 90 per cent firms are using commercial off-the-shelf AI tools, while 28.3 per cent are customising such tools for enterprise-specific needs.
Two in five AI-adopting enterprises are either expanding deployment or have fully deployed or integrated AI across the organisation, suggesting that businesses are moving from experimentation to broader implementation.
AI adoption is also delivering measurable business outcomes, according to the report. Among organisations using AI, 87.6 per cent say key benefits are productivity and process improvement, while 44 per cent say cost reduction and resource optimisation.
More workers use AI at work
Among workers, AI usage is also rising. The IMDA report revealed that 86 per cent of workers use AI at work in 2026, up from 78 per cent in 2025.
For the AI users, 73 per cent reported productivity improvements, 69 per cent said AI improved work quality, and 68 per cent said it strengthened problem-solving capabilities. Among those who saved time by using AI, 60 per cent saved up to one hour a day.
Workers are using AI across a wide variety of workplace tasks: content creation (77 per cent), process automation (66 per cent), and data exploration and analytics (over 50 per cent).
However, the report also highlighted a gap between workers’ ambitions and their access to training. Some 68 per cent of workers say they need to upskill or reskill in AI, but only 37 per cent attended AI-related training in the past 12 months.
Among those who did not attend training, around 35 per cent said they were not nominated by their employers, while a similar number cited a lack of time. About one in four were unsure which course was right for them.
IMDA expands AI training
To support workers, IMDA is expanding the TechSkills Accelerator (TeSA) under the National AI Impact Programme.
TeSA aims to upskill 40,000 tech professionals over the next three years, equipping them with advanced AI skills, including capabilities in full-stack development and agentic AI.
For the non-tech workforce, the National AI Impact Programme will train 100,000 professionals in domain-specific AI skills by 2029. The rollout is already underway in sectors such as accountancy and law.
“Singapore’s digital economy continues to demonstrate encouraging growth as both enterprises and workers embrace new solutions in their digital transformation journeys,” said Ng Cher Pong, chief executive of IMDA.
Equipping workers with practical, domain-specific AI skills would help Singapore’s workforce maintain a competitive edge, he added.
