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The Bauhinia Foundation Research Centre (the Centre) today released a study on ‘Where to find new key driver: The Emergence of Post-50 cohort, Hong Kong’s manpower strategies start afresh’. It reviewed the changes of Labour Force Participation Rate (LFPR) from 1998 to 2018, and analysed the relationship between the LFPR and the demographic characteristics (i.e. gender, age, education level and marital status). The study, in particular, targeted to review the untapped potential of people aged 50 or above (i.e. Post-50) and their impacts on the labour market.
We hope the findings help lay a groundwork for the society and Government to unearth the potential of local workforce, and further enhance the manpower planning strategies to promote Post-50 employment and maintain the long-term competitiveness of Hong Kong.
The slowdown of economy in recent days has been strongly affecting all walks of life in Hong Kong. Employees are facing the risks of unemployment as the labour market eased gradually. The Government has launched several relief measures to support enterprises during this difficult time. However, the public expects the Government to adopt multi-pronged measures to explore business as well as job opportunities, regardless of economic ups and downs.
The Hong Kong Budget 2020/21 emphasised on the challenges posed by the ageing population and the decline of the workforce. Despite ageing populations’ adverse effect on the society, there are chances to foster the vibrant development of the city. Hence, the Centre recommends that the Government should address the problems at root. We can unleash the potential of Hong Kong's labour force and cope with the rapid socio-economic changes through training and programmes.
The Centre's Chairman Mr Lau Ming-wai said, 'The study revealed that Hong Kong has not been able to give full play to its talents. Many people have the ability and are willing to work. Yet, there are various obstacles keeping them out of the labour market. Taking “Post-50” as an example, confronted by demands for multi-faceted skills and pressure of being adaptive to a fast-changing work environment, some of them fail to secure an employment. Hence, the society, in particular the Hong Kong Government should provide adequate support measures and appropriate training for them to stay competitive in workplaces. They can then become a “fresh source of manpower supply” in the labour market of Hong Kong.’
Detailed analyses are as follows:
From 1998 to 2018, the labour force aged 15 to 49 reduced by around 270,000 persons, while ‘Post-50’ recorded an increase of approximately 800,000 persons. That said, an increase of around 530,000 persons in Hong Kong’s overall labour force can be attributable to the new impetus brought by ‘Post-50’. Persons aged 60 to 64 were more active in the labour market. Such LFPR increased by 17.1 percentage points from 29.9% in 1998 to 47.0% in 2018, showing a higher growth than other ‘Post-50’ age groups.
Indeed, the LFPR of the ‘Post-50’ male workforce rebounded. For example, males aged 55 to 59 have their LFPR first decreased from 77.5% in 1998 to 76.1% in 2003, but edged up to 82.6% in 2018. A research suggested that one of the contributing reasons may be the implementation of Minimum Wage Ordinance in 2011, which attracted more male workforce (especially those aged 55 to 64, with education up to secondary 3) to join or re-enter the labour market.
Having reviewed the labour force data by educational attainment in 2011 and 2016, the study found that the group of persons with lower levels of education generally had a lower LFPR regardless of gender or age. For example, in 2016, the overall LFPRs of ‘Primary and below’, ‘Secondary’ and ‘Tertiary’ education were 27.6%, 60.6% and 75.5% respectively.
It is worth noting that when there was a downtrend of overall LFPR in different educational attainments, the LFPR of ‘Post-50’ moved upwards. In addition, the more educated the persons of this generation were, the higher the LFPR growth rate resulted: the LFPR of ‘Post-50’ with ‘Primary and below’, ‘Secondary’ and ‘Tertiary’ education rose by 0.1, 1.9 and 3.7 percentage points respectively. The LFPR of workers aged 60 to 64 with different levels of education attainment witnessed visible increases, up by 8.8 to 10.5 percentage points among the ‘Post-50’ group.
The study found that Hong Kong’s overall LFPR slightly dropped from 60.2% in 1998 to 59.2% in 2018, and the level in 2018 was lower than the neighbouring Asian economies such as Singapore (67.7%), South Korea (63.1%) and Japan (61.5%). Analysed with the attributes of gender and age, LFPR was mainly pulled down by male and youth groups. From 1998 to 2018, female became active labour force entrants, while the LFPR for the younger generation (i.e. aged 15 to 24) showed a decreasing trend. The increased opportunities for further studies and pre-employment trainings might partly explain why the youth have delayed their entry to the workplace. The LFPR of women aged 30 to 64 has been growing over that 20 years. Each age group has a rise of over 8%. Taking ‘Post-50’ women as an example, their LFPR raised by 4.2 to 25.4 percentage points.
The LFPR of ‘never married’ persons (2011: 64.4%; 2016: 66.1%) was higher than that of ‘married’ persons (2011: 59.4%; 2016: 60.0%) in both 2011 and 2016. However, when the figures were analysed by gender, the differences were prominent. LFPR of ‘married’ male was higher than that of ‘never married’ in most age groups while LFPR of ‘married’ female was generally lower than that of ‘never married’ for age 20 and above.
The findings above may indicate that men are often regarded as the breadwinner in traditional families and women tend to leave the job market for taking up a caring role. In 2018, the LFPR of female aged 40 to 49 was around 70% (aged 40 to 44: 70.8%; aged 45 to 49: 70.0%), lower than that of female aged 25 to 29 (84.3%) by more than 10 percentage points. This reflected that women might not be able to re-enter the workforce once they took a career break for marriage or childbirth, resulting in the sustained lower level of LFPR among female aged 30 and above than those aged 25 to 29.
In view of the above, the Centre proposes the following policy directions in an attempt to improve manpower strategies and harness the potential labour force of ‘Post-50’ and persons of other groups:
Though Hong Kong has been near full employment and the unemployment rate held steady at around 3% in recent years, there has been a slight increase in the jobless rate from 2.8% to 3.4% since mid-2019. The outbreak of novel coronavirus, and downward pressure stemming from local and external uncertainties, constitute unfavourable factors that might further deal a blow to the labour market. In the event of an economic downturn, employment opportunities will inevitably be reduced. Thus, the Government should promote development of industries, help diversify the industrial structure and broadening the job variety and boost the economic dynamism, thereby drawing more individuals into the labour market.
This study found that the ‘Post-50’ workers with a wealth of skills and experiences have become a source of new blood for Hong Kong’s labour market that cannot be taken lightly. In view of this, the Government should deploy more resources to explore new employment opportunities in different sectors for mature workers, enabling ‘Post-50’ to shine and feel valued in full-time, half-time or even part-time jobs on a long-term basis, so as to meet the manpower demand in future.
Education matters when it comes to achieve upward social mobility. A higher educational attainment is conducive to a person’s work capacity and employability, which brings about a positive impact on the overall manpower supply. However, in 2016, there were 20.6% of persons aged 15 and above with ‘Primary and below’ education (around 1.27 million persons), with around 920,000 of them were economically inactive. The Centre believes that the Government should continuously invest in education and training to nurture local manpower, as well as provide them with more value-added opportunities in an effort to enhance their competitiveness and adaptiveness to the ever-changing social environment. Apart from the mainstream academic education, the Centre suggests enhancing the vocational and professional education training (VPET) by raising public recognition towards VPET, along with increasing the opportunities and incentives for on-the-job training and continuing education. It is anticipated that the potential labour force will be provided with multiple pathways and better equipped to face the workplace challenges more easily.
Findings also revealed that women displayed stronger intentions to participate in the labour market than before. Yet the LFPRs of female aged 30 and over stood at a constant lower level than that of 25 to 29 years old. In 2016, there were around 770,000 economically inactive females aged 30 to 64, among whom almost 60% (58.9%) were home-makers, and 65.9% had completed at least secondary education. Apparently, their levels of education were not particularly low. The Centre believes that family-friendly employment practices in Hong Kong are yet to be popularised. Female homeworkers or early retirees among ‘Post-50’ may be discouraged to work because of a lack of flexible working arrangements.
According to the 2018 survey conducted by the Census and Statistics Department, around 99,000 economically inactive persons aged 15 to 69 expressed willingness to engage work provided that they could enjoy Convenient Working Hours (63.6%), Attractive Salary (38.9%) or Work Place near Home (37.3%), etc. Flexible working arrangements can be viewed as one of the key factors to attract the aforementioned people to work.
In view of the above-mentioned, the Government and enterprises should promote friendly employment culture and facilitate employers to adopt employee-oriented practices, including the provisions of flexible retirement arrangements for ‘Post-50’ and family-friendly measures for working mothers.
In sum, the ups and downs of LFPR cannot simply be attributed to any single cause. Apart from the factors mentioned above, other policy initiatives or laws and regulations may also affect people’s willingness to work and their job opportunities. For example, the effectiveness of the Statutory Minimum Wage, the adequacy of employment-assistance measures such as job-matching for the elderly, the sufficiency of proper childcare services, and even the impact of age limit on ‘Post-50’ workers in certain industries are all worth studying. The Government should step up efforts to delve into these issues, adopting a multi-pronged approach to develop the manpower planning and adjust its human resource strategies, with a view to creating a favourable working environment for the potential labour force such as ‘Post-50’ and hence achieving the sustainable socio-economic development.