26 September 2023

HONG KONG: Proposed PS pay rise worries business

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Hong Kong’s business leaders are calling on the Government to lower proposed salary increases for Public Servants to below four per cent to ease pressure on the private sector amid the early stages of post-pandemic economic recovery.

Industry representatives said some sectors were recovering faster than others and were already offering higher pay in an effort to retain staff amid labour shortages.

The latest pay trend survey suggests increments of 2.87 per cent for high earners, 4.65 per cent for middle-ranking employees and 4.5 per cent for junior members of the 176,244-strong Public Service.

The Civil Service Bureau said it would meet representatives from the workforce to discuss this year’s salary adjustments.

Chief Executive, John Lee Ka-chiu will make the final call, but additional funding for the salary increases would then need approval from the Legislative Council.

The suggested annual pay rises for Public Servants serve as indicators for the private sector, hence the concern of business leaders.

President of the Hong Kong General Chamber of Small and Medium Business, Michael Lai Cheuk-pun, said the suggested increases were relatively high from his sector’s point of view and would put pressure on firms as economic recovery was still fragile.

“The extent of the economic recovery varies in different sectors. In retail, for example, there was indeed a rebound after the return to normality and the reopening of Hong Kong, but it flattened out in March and April,” Mr Lai said.

“However, for logistics and transport, the atmosphere and the external trade were quite bad in the first quarter.”

He said yearly salary increases in such industries might not match the adjustments suggested for Public Servants.

Hong Kong, 21 May 2023

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