Hong Kong Faces Deepening Employment Polarization

Hong Kong faces a polarized employment landscape. Construction and services clamor for foreign workers while finance layoffs leave bankers stranded.
28 August 2023 by
Hong Kong Faces Deepening Employment Polarization
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Hong Kong's job market is experiencing increasing polarization, with specific industries facing dire labor shortages while finance sectors shed workers. This dichotomy illustrates shifting economic priorities and demographics in the territory.

The Hong Kong government announced a plan last few months to import foreign workers for 26 professions facing severe hiring struggles, including construction, transportation, retail sales, food service, hairdressing and more. Construction and transport have quotas for up to 20,000 foreign workers each.

Simultaneously, waves of layoffs continue at foreign investment banks in Hong Kong. Finance constitutes 7% of Hong Kong's workforce but over 20% of GDP.

Industry transitions, an aging workforce, and economic uncertainty are sidelining bankers, but adjacent industries cannot absorb all the talent. Some resort to entrepreneurship or emigration.

Meanwhile, office vacancy rates have hit record highs of 14.7%, well above Manhattan and Singapore, as banks leave prime real estate empty. Developers continue building despite 21% vacancy at flagship centers like Cheung Kong Center.

Experts say data shows a disconnect between strong labor markets and weakening commercial real estate demand, due to population decline and falling labor force participation. An aging, shrinking workforce necessitates foreign labor in manual jobs, while office jobs wane.

This dichotomy illustrates Hong Kong's economic evolution. As the territory's finance industry contracts, pragmatic labor needs in services and construction grow urgent, leaving white-collar workers stranded - and a polarized job landscape.

Hong Kong Faces Deepening Employment Polarization
NewPages 28 August 2023
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