Photo 8.jpg

It is widely agreed that a shortage of qualified personnel is becoming increasingly acute in all of Hong Kong’s important pillar industries. It is a phenomenon that underpins a disconnect between education, labor, and population policies – and it will require a holistic approach by bringing aboard the private and public sectors to forge a long-term, multi-faceted plan in order to maintain a workforce critical to Hong Kong’s continued development

By Queenie Tsui

According to AmCham’s 2015 annual survey, Hong Kong’s pool of talent from which employers can draw to meet their needs in human resources remains a key issue among senior executives of businesses across the board. The issue, particularly in relation to a local shortage of those skilled in technical professions as well as those specializing in the “white-collar” sectors of insurance, asset and wealth management, is touted as a major hurdle to the locally economic development.

It is widely agreed that shortages are most acute in logistics and transport services, IT, business and professional services, wholesale import and export trading, and restaurants and catering – all important pillar industries of Hong Kong. It has become a severe problem that companies in those sectors are pushing the government to do more in addressing the issue as they continue to experience frustration in their process of hiring qualified personnel.

There are a number of sub-issues in the larger issue of labor/talent shortage: AmCham has heard repeatedly that member companies endlessly find it difficult to locate the right local talent and university graduates for job vacancies, due to reasons including their language capabilities and the general lack of a global mindset among them. In the technical fields of technology, cloud computing, solution architecture, and IT project management are in huge demand without a local supply of people with such expertise.

More specifically, Hong Kong’s position in aircraft maintenance, repair and overhaul (MRO) is battered because young people are reluctant to join an industry which they see as non-lucrative. Hong Kong Aircraft Engineering Co (Haeco) said in its 2012 annual report that it couldn’t meet the demand for airframe maintenance during the year as a result of a shortage of skilled labor.

“Having vibrant international and competitive talent is Hong Kong’s most valuable asset,” says Diana David, Chairperson of AmCham’s Education Affairs Group (EAG) and a governor of the Chamber. “Talent, whether coming from overseas, Mainland, or home-grown, needs to be internationally aware and connected.”

The current situation strongly indicates that this is no longer a matter of corporate policy, but a local phenomenon that underpins a disconnect between education, labor, and population policies in a 21st century economy that is evolving very quickly. And it will require a holistic approach by bringing aboard both the private and public sectors to discuss and understand the issue, and then to forge a multi-faceted plan and execute for the long-term, sustainable development of a skilled workforce in Hong Kong.

Areas of high importance, David notes, include: surveying AmCham’s multinational membership to understand skills and attributes needed in today’s workplace and where gaps remain, raising the profile of vocational training, reviewing immigration policy to allow overseas and Mainland students to study and intern in Hong Kong, and continuing an outreach program into local schools by AmCham leaders.

The education agenda

The first step to talent development is education. As an international chamber of commerce, AmCham is well aware of cases concerning the level of dissatisfaction with the availability of school places in Hong Kong. Because international schools, in general, provide a learning environment that is more open, multicultural, linguistically adept and internationally minded, there is a huge demand among expatriate and local parents alike.

The demand drives an imbalance in the public and private education systems, causing a knock-on effect as overseas families have had grim difficulty in finding school places for their children in Hong Kong. Some families had no other alternative but to send their children abroad to boarding schools, and other families as a whole simply left Hong Kong for neighboring cities.

As such, AmCham through its Education Affairs Group (EAG) has been lobbying the government over the past years on the shortage of international school places, insufficient support for non-English speaking students with special education needs, declining language capabilities of students and the overall lack of confidence in the public education system.

The Chamber’s long-standing emphases on many of these issues, particularly on international school spaces, have garnered solid government response. The government has made considerable efforts to promote the development of the international school sector and to enable existing international schools to undergo expansion in meeting the growing demand of the community.

The Education Bureau through its School Allocation Exercise in 2014 released two vacant school premises and three greenfield sites and invited international schools to submit their development and expansion proposals. It is expected that a total of 4,270 school places (3,490 primary places and 780 secondary places) will be made available starting from the 2016/17 academic year.

And there is more: as announced in most recent Policy Address by Hong Kong’s Chief Executive, the government will promote interdisciplinary curriculums emphasizing “whole-person development,” with a focus on science, technology, engineering and mathematics (STEM) to prepare students for the challenges brought upon by the recent economic, scientific and technological developments. It is a progressive approach to aligning with the world’s education trends and enhancing the public school system.

The ongoing effort bodes well for Hong Kong as it is key to retaining a competitive edge and having the capacity to attract, develop and retain talent. And it leads to the important priority of casting a long-term, sustainable human capital strategy to cope with the rising demand for talent as a result of the shifting global economy and Hong Kong’s structural transformation towards being a city of the skilled.

For this reason, AmCham’s EAG has expanded its scope from a purely advocacy standpoint on education to a strategic discussion and execution on the mapping of talent development. EAG is progressing into another phase of working with the government to forge closer ties between the public and private business sectors for further collaboration and to strategize ways of nurturing and attracting the necessary talent that Hong Kong urgently needs to remain competitive in the near and longer terms.

The larger issues

The issue of talent development, in Hong Kong’s context, is not only about the availability or allocation of human resources, but is also hampered by a set of social perceptions at large. When students rush into the legal, medical and financial services industries over other technical professions seen as less promising, it creates an imbalanced trend of academic and career choices among young people.

Hong Kong is also perceived to have become less entrepreneurial in an economy believed to have a decreasing appetite for risk-taking, creativity and innovative thinking. While these trends are closely correlated to the economic shifts taking place, they are a source of concern in the diversity of talent across a wide range of industries. They could lead to a down-spiral of home-grown talent in terms of quality as well as quantity, further widening the gap in the talent equation.

The Education Bureau is acknowledged for the efforts in providing students with early career planning – it is very encouraging to see that steps are being taken for the goal of career diversification in the workforce. The Bureau’s Career and Life Planning Grant of HK$200 million each year targets public and semi-public secondary schools for classes of life-planning (LP) education and career guidance. This is a great way to expose young people to technical professions where shortages abound.

AmCham is also doing more. The Chamber’s outreach program, “Conversation with an AmCham Leader”, seeks to stimulate and broaden the mindset of schools, parents and students on the issue of career development. It highlights stories of “vocational heroes” through talks at local secondary schools, emphasizing opportunities for vocational training and jobs, and how they can be a step ahead in the job market by having the right mindset and skills including language capabilities.

A PwC survey has shown that millennials (those born after 1980) will form over 50 percent of the workforce by 2020, while the government has estimated that Hong Kong could face a shortage of 117,900 workers in different sectors by 2022. Together, these statistics manifest that a demographic change, together with a shrinking workforce skilled enough for today’s market, is poised to pose an enormous challenge.

To tackle the labor shortage, Hong Kong’s Labour Department has implemented a scheme since 1996 allowing employers with difficulties finding suitable staff in Hong Kong to bring in non-local workers. The application process, however, can take months or even a year before any decision can be reached, partly due to the necessary reviews by employee representatives on the Labor Advisory Board. While the import of non-local workers can be a controversial subject, there needs to be a sensible approach.

It is important to bear in mind that the shortage is set to grow steadily more acute and that Hong Kong’s economic competitiveness in the 21st century depends on a skilled workforce. A diverse labor force in an inclusive environment is critical to the city’s overall economy, and a review on immigration policy for overseas and Mainland students as well as foreign, legally registered same-sex and domestic partnerships and marriages must take place to afford Hong Kong a level playing field.

Given Hong Kong’s experience in global business, there is no reason that it can’t be leveraged for the long-term development of a workforce highly geared for the local market today. And there is every reason that companies are looking for ways to collaborate in nurturing a generation of talent whom may one day turn out to be their employees. What’s needed is a thought leader to connect all the dots.