While Hong Kong’s economy has shown signs of rebounding and flagging industries have regained steam, there is still an acute labor crunch in various sectors. Hong Kong has to resolve its manpower shortage. The Hong Kong Special Administrative Region government’s recent proposal to import workers will help close the demand-supply gap. Only when Hong Kong has abundant manpower can its economic vitality be sustained by sizeable new investment.
Recently, the government proposed bringing in 20,000 nonlocal workers starting this month under a sector-specific labor importation program aimed at easing the severe manpower shortage in the construction, aviation and transportation sectors, which have been allocated a quota of 12,000, 6,300 and 1,700 respectively.
In the construction industry, the government will give priority to applications related to large-scale public infrastructure projects. It has also proposed lifting an import ban on 26 low-skilled-job categories, including waiters, hairstylists and cashiers, among others, for two years under the incumbent Supplementary Labour Scheme (SLS), which has been in place since 1996 to help fill vacancies at technician level or below.
At present, the number of nonlocal workers imported to Hong Kong has remained at a low level. According to government statistics, nonlocal workers, including those from foreign countries, foreign domestic workers and those from the mainland, account for only 13.9 percent of the workforce. The number of approved labor importation cases under the SLS has remained low — as evidenced by the fact that the number of approvals stood at only about 1,900 each year between 2003 and 2021. It’s crucial that Hong Kong imports more nonlocal workers from the mainland or other neighboring markets, complementing the local workforce and easing the acute labor crunch.
While some Asian economies, including Singapore, Japan and South Korea, have had to deal with both a rapidly aging population and a declining workforce, Singapore has one of the largest foreign workforces in the world. Its labor importation policy has partly contributed to the country’s rapid infrastructure development and miraculous economic growth. Singapore’s Ministry of Manpower has offered various work permits — including the “S Pass” and “Work Permit for Migrant Worker” — to skilled workers and semi-skilled workers in the construction, manufacturing and marine shipyard sectors. Based on the ministry’s statistics, the total foreign workforce stood at 1.42 million — which accounted for about one-third of Singapore’s labor force of around 3.75 million in 2022. The massive number of foreign laborers has enabled Singapore to overcome labor shortages and fueled GDP growth — despite concerns that foreign labor exerts pressure on public services and facilities. Hong Kong should take a leaf out of Singapore’s book.
While Hong Kong is staying ahead in the race for economic growth, the authorities need to step up efforts to address the current labor crunch, which is holding back local economic development
From the perspective of employers and businesses, Hong Kong needs abundant manpower to sustain economic momentum and growth. The latest statistics show that the city’s labor force, excluding foreign domestic workers, fell to 3.46 million in 2022 from 3.68 million in 2018, with the number of low-skilled workers declining by 160,000. Hong Kong’s jobless rate declined to 3.1 percent in the three months to March, signaling that the labor market has improved alongside a rebound in economic activities and tourism. Against this background, both foreign and local enterprises have encountered great difficulties in hiring enough workers to expand their operations. Without replenishment of the labor market with nonlocal workers, the city’s economic vitality is likely to diminish, undermining its economic competitiveness.
The employment opportunities and interests of local workers would be adequately safeguarded under the proposed labor importation policy. Participating employers are required to maintain the ratio of full-time local workers to imported workers at 2-to-1; nonlocal workers’ wages must not be lower than the median levels of their local counterparts; and employers must provide nonlocal workers with accommodations either in Hong Kong or on the mainland. With all these mandatory requirements, employment priority has been given to local workers — and the labor importation programs cannot be exploited by unscrupulous employers to import cheap labor.
Another way to ease the labor shortage is to make cross-boundary travel easier for Hong Kong people who live in Shenzhen or other nearby cities. With the further integration of the Guangdong-Hong Kong-Macao Greater Bay Area, Hong Kong can also consider tapping Shenzhen’s workforce and by implementing measures so Shenzhen residents can easily commute to and work in Hong Kong.
A model that further integrates Hong Kong’s and Shenzhen’s development can be pursued. The first step would be for Hong Kong and Shenzhen authorities to explore how to expedite cross-boundary clearance procedures. It would be ideal for Hong Kong workers living in Shenzhen to commute to Hong Kong for work if Shenzhen and Hong Kong can adopt the Macao-Zhuhai cross-boundary clearance arrangement or “joint inspection and one-time customs clearance”. Second, the HKSAR government can consider offering subsidies to Hong Kong workers who take public transportation to commute across the boundary. It would be much easier for those Hong Kong workers who live in the eastern part of Shenzhen but work in Hong Kong if there are frequent and inexpensive buses connecting Central and Liantang Port. Third, Hong Kong can further relax restrictions on Shenzhen residents traveling across the boundary and working in the Northern Metropolis as the new development plan further promotes cross-boundary cooperation.
Under the government’s labor importation programs, Hong Kong can absorb nonlocal workers equipped with necessary skills to take up those jobs that cannot be filled by locals. Certainly, the HKSAR government can seek further advice from the Labour Advisory Board on protecting the interests of local workers. While Hong Kong is staying ahead in the race for economic growth, the authorities need to step up efforts to address the current labor crunch, which is holding back local economic development.
The author is a member of the Beijing Municipal Committee of the Chinese People’s Political Consultative Conference, and founder and chairman of the One Country Two Systems Youth Forum.
The views do not necessarily reflect those of China Daily.