Sunday, 16 December 2012

Hong Kong's Great Divide

The newly established Commission on Poverty is finally starting to discuss what the city's poverty line should be. It's a long time coming since former Chief Executive Donald Tsang Yam-kuen didn't seem to acknowledge there are impoverished families here.

It will be calculated as half the media household income and is by no means a black-and-white way of deciding who's poor and who's not; it will find out how impoverished families are getting by and what kinds of services they need.

Nelson Chow Wing-sun, a professor at the University of Hong Kong and an expert in social security, welfare and poverty said, "To think that having a poverty line is going to define everything and tell us everything about the poor is wrong. A poverty line actually doesn't measure poverty. It only tells us about income disparity."

According to the Census and Statistics Department, Hong Kong's Gini Coefficient that measures income disparity was 0.475 last year, the same as in 2006, but up from 0.470 in 2001. The closer the number is to 1, the greater the income disparity. When it is between 0.4 and 0.5, there is a significant income gap.

Next door on the mainland, the Chinese government refused to release the Gini Coefficient at the beginning of this year -- the 11th straight year --  on the excuse that it doesn't have accurate data. The real reason is probably that the number is so high that it could be politically destabilizing.

Chow says in the last seven years, the numbers of poor in Hong Kong are increasing, and it's not just the elderly, but also young people as well.

He said under the Tsang administration, social policies were stagnant, leading to even greater problems for the underprivileged.

For the elderly, inflation is the culprit, but also many didn't save enough money and are reluctant to ask for welfare.

Then there are the working poor who are struggling to make ends meet with children to raise. Stephen Fisher directory general of Oxfam Hong Kong says this group of people needs some kind of allowance from the government to help these families survive.

Nevertheless, Chow is most concerned about a new social class -- poor young people.

While they may have a decent education, they cannot find a decent-paying job and are left doing work in the service industry like working in convenient stores, restaurants or retail.

"Tsang created a whole class of new poor: the young," Chow said. "The middle class is sliding back into poverty, and we now have a new generation that is on the margin of poverty."

He explains one-third of the 3.7 million workforce earn between HK$10,000 and HK$20,000 ($1,290-$2,580) a month, and 60 percent of the people on these low incomes are under 35 years old. Even after working for 10 years, some are still making less than HK$20,000 a month. This is even though they have gone through post-secondary education.

"Imagine parents working hard to put a child through university in the hope of a better future," Chow said. "In the end, the child earns [less than HK$20,000]. Job diversity is so narrow in Hong Kong. No wonder young people have become frustrated and angry. They feel stuck. There is no social mobility, no hope."

Professor Joe Leung Cho-bun, Chow's colleague at HKU says it's not a good sign when many of the working poor are young people.

"The 'ageing population dilemma' has crowded the government's minds, and we've forgotten that apart from caring for the retiring baby boomer generation, we need to help the next generation," Leung said. The city's lack of industries and employment outside of development and finance-related fields are stifling the future of Hong Kong, he warned. Leung said the government needed to help "make work pay", so that a full-time job would actually cover rent and daily expenses and sustain a family.

How did Hong Kong become like this?

I also have to wonder if it is the younger generation having apathy towards work and having a career.

More than one public relations person working in hotels has told me how difficult it is to find not only a qualified person in Hong Kong, but someone willing to put in long hard hours. In the department I work in, the youngest member, a woman who is in her late 20s has decided to quit her job after over two years for "a break" even though she didn't seem particularly hard working, nor motivated to move up the ladder.

Is it because these people were the first generation reared by mostly Philippine maids and so they are spoiled in their upbringing? Is it because they feel the world should revolve around them and they should be able to choose what their working hours are instead of being dictated by office policy? They also seem much more insular, used to communicating online instead of face-to-face, making it harder for their older colleagues to deal with this different work ethic.

And not having had learned the concept of work throughout their younger years like those in the West who had summer jobs, entering the work force for young Hong Kong people can be a culture shock.

In any event, this is a sad state of affairs in Hong Kong. How can one be optimistic about the future if young people see no light at the end of the tunnel?

But by the same token they too need to work hard to gain more experience and then leverage that into a better job.

We need to accept there is a big problem and have to start tackling it. The solution will not come tomorrow; it is a work in progress. But the more we delay it, things will only get worse.


  1. "one-third of the 3.7 million workforce earn between HK$10,000 and HK$20,000 ($1,290-$2,580) a month".

    I have to admit that I was expecting it to be more than that. Also, I wonder how many Hong Kongers earn less than HK$10,000 a month. Looking at the number of security guards, waitstaff, sanitation workers and such that there are in the territory, I'd think quite a lot. (I remember reading a while back that security guards average HK$8,000 a month; ditto waitstaff at cha chaan teng and the like.)

    More than incidentally, I have a hairstylist friend who told me that five years ago, she was making HK$8,000 a month (without including tips). She's not the kind of person I'd think of as being spoilt -- and can imagine that she'd be pretty hardworking. But she left school before even Form 5 -- and I wonder how many people are in her situation.

    Ditto re another friend who has a job who has a diploma but whose primary job I don't think pays HK$20,000 a month, let alone more than that. So what she does is have a second job to supplement her income.

  2. Hi YTSL -- yes definitely a good question to ask. Apparently one in five people in Hong Kong live in poverty, probably less than HK$10,000 a month. I remember reading about how some people have to get by on HK$100 a day.

    The problem is that the government really doesn't know the extent of the poverty situation in the city so hopefully this baseline will help them figure it out and make it realize it has many social challenges to tackle thanks to Donald Tsang's seeming neglect of this serious issue.