Speaking to reporters on Monday after meeting public transport workers during his traditional visit to essential services during the Lunar New Year, Mr Lee said Singapore has to take the slowdown in it's stride.
He indicated that the government will know what it needs to do.
The upcoming Budget next month is expected to address the impending economic slowdown.
It was a rare sight to see the Prime Minister travelling on the MRT with morning commuters.
Mr Lee gave out hong baos to SMRT staff at seven stations on the North-South line from Ang Mo Kio to Newton.
He also met SBS Transit staff at the Jurong East Bus Interchange.
The last time Mr Lee met public transport workers during the Lunar New Year was five years ago.
Mr Lee acknowledged that it has been a demanding time especially for train workers after the recent service disruptions.
He said: "I think the MRT and SBS staff have been under considerable pressure but they have been working away quietly to try and put right the problem and improve the service and I think they deserve our appreciation and thanks."
And as he gave out hong baos (red packets) to workers, Mr Lee was asked if Singaporeans too can also expect hong baos at the upcoming budget, given the economic slowdown.
Mr Lee: "I think this is Chinese New Year and hong baos are on everybody's mind but we will see how our budget works out. The government will know what it needs to do but hong baos is only during Chinese New Year."
Acting CEO of SMRT, Tan Ek Kia said that staff have been working hard.
"They all have had to work very hard to restore the service to the level that we see today, and we will continue to work hard and continue to make improvements based on what we have been able to identify in the last few weeks. And for the Prime Minister to make this special effort to come and meet the staff and thank them, we really appreciate it."
In his Lunar New Year message on January 22, Mr Lee announced that Singapore's Total Fertility Rate (TFR) picked up slightly last year to 1.20, up from a historic low of 1.15 in 2010.
On the issue of the growing the country's fertility rate, Mr Lee said providing baby bonuses is not the first thing on his mind.
But he said the government will look at the scheme and review it from time to time.
Mr Lee stressed that the critical point is not financial incentives.
Mr Lee said: "The critical point now is social mood and social climate as well as attitudes of parents and couples towards children, career, what they would like to see as fulfilling and satisfying, rounded and complete satisfaction in their lives and that includes having children that's something we have to get across progressively step by step."
And Mr Lee had this message for couples thinking of starting a family.
"If you are thinking about possibly having a baby, why not make up your mind and if you're not yet having it first on your agenda, let's think about it. If you start thinking now, there's just enough time to have a Dragon baby."
He added there are already comprehensive incentives to ease the burden on parents or couples who are thinking of having children.
- CNA/fa/ck
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