The decline in retail sales is fuelling an increase in the number of Hong Kong jobless people.
Early this year, Hong Kong’s overall unemployment rate reached a two-year high of 3.4 per cent, with the Legislative Council Secretariat saying that in view of the worsening business performance in retail, restaurants, hotels and construction offering a “cautious” employment outlook.
“Lower-skilled occupations are expected to face greater retrenchment pressure,” the secretariat says in its new research brief, The Challenges of Manpower Adjustment in Hong Kong.
In February-April, the unemployment rate of shop workers rose more visibly by 5 per cent over the same period last year.
In parallel with the work fragmentation trend, the total number of casual and part-time employees and self-employed persons in Hong Kong rose to about 524,000 last year – 40 per cent more than in 1999. “This flexible workforce is generally subject to greater job insecurity, fewer statutory employment benefits and lower employment income than permanent employees.”
The proportion of the workforce with degree education rose from 9 to 29 per cent between 1994 and last year, but fewer than half of them have been able to take up managerial and professional jobs. Between 2008 and last year, 26 per cent of people with a degree had to work in clerical, service and shop sales positions. This compares with 17 per cent in the previous seven-year bracket, and 12 per cent for the seven years before that.
This meant their potential income was almost cut in half, with median monthly earnings of about HK$11,000-13,000.
“As the creation of high-end jobs cannot keep pace with manpower supply amid slow progress in structural change in the economy toward knowledge-based activities, more workers with degree education need to take up lower-skilled occupations, inevitably resulting in a large wage discount.”
Citing entrepreneurship as a key driver for economic growth and job creation, the research shows that the proportion of employers in the workforce has almost halved over the past two decades to just 3 per cent. “Waning entrepreneurship can be attributed to diminishing opportunities in the manufacturing and trading sectors, reduced appetite for risk-taking, high property rentals and funding constraints.”
It was the fourth such brief, prepared by the secretariat’s research office.