The Korea Times

Pay in HK’s retail, travel sectors below others

Wage gap feared to hurt service quality, city’s recovery efforts

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Wage increases for retail and travel workers have fallen behind all other sectors as Hong Kong battles back from the pandemic, with an industry associatio­n warning the pay gap may affect service quality and derail the city’s bid to recover its status as a top tourist destinatio­n.

Industry representa­tives appealed earlier tis month to authoritie­s to develop strategies to support retailers through its mega-event economy and help to stem a brain drain driven by sluggish pay rises.

Lam Chi-chung, the general secretary of the Hong Kong Department Store and Commercial Staff General Union, said retailers were less likely to offer attractive packages to keep skilled workers compared with other sectors.

He added the industry also tended to hire less-experience­d staff and provide on-the-job training.

Lam said both factors could affect tourists’ perception of Hong Kong as a top-notch destinatio­n.

“Complaints about declining service quality have already surfaced,” Lam said.

“The persistent pay gaps are likely to drive more experience­d workers towards other sectors, exacerbati­ng the problem”

A Post study of census statistics spanning five years and 21 industries found that retail and travel sector workers had benefited least from the post-coronaviru­s economic recovery.

The figures showed retail workers received a total pay rise of 0.71 percent in median income between 2019 and 2023, while staff in the travel sector got a salary increase of 1.31 percent over the same period.

The Post study revealed that 2023 marked a return to pre-pandemic pay levels for all industries covered in the survey, although the retail sector was still close to the bottom of the heap.

Lam warned the wage squeeze could create a vicious circle where employers became less prepared to offer generous packages amid sluggish economic growth and increasing rents.

“Fewer good staff, poorer service quality — this could directly impact tourists’ overall experience in Hong Kong, regardless of the government’s efforts in other areas,” Lam said.

Government figures showed the city’s retail sector employs more than 261,000 people.

Fewer good staff, poorer service quality — this could directly

impact tourists’ overall experience

in Hong Kong.

A Census and Statistics Department survey published on March 25 showed employees in the city earned a median income a month of HK$19,800 ($2,530) in mid-2023.

The figure represente­d year-on-year growth of 3.5 percent, higher than the median incomes of HK$14,100 a month in retail and HK$15,500 a month in the travel sector.

The Legislativ­e Council’s manpower panel is expected to discuss the survey’s findings on Friday.

Hong Kong’s economy, battered by the effects of the pandemic, contracted for two years in a row — by 1.2 percent in 2019 and 6.1 per cent in 2020.

Consumer spending and tourism-related sectors were particular­ly hard-hit.

The median income per month for retail staff stood at HK$14,000 in 2019. The figure dropped to HK$13,500 in 2021 before a slight increase to HK$13,800 a year later.

The figure went up to HK$14,100 last year after all social distancing and travel restrictio­ns were scrapped at the start of 2023.

The number of retail establishm­ents increased to 3,171 over the five-year window.

But the number of staff employed in the sector fell from 261,058 in December 2019 to 245,680 in the same month last year.

People working in travel agencies, reservatio­n services and related industries had the second-lowest wage rise over the period.

Their pay went up from HK$15,300 a month to HK$15,500 a month — 1.31 percent.

But staff in finance and insurance, food processing, care of the elderly and courier services recorded the highest increase, more than 11 percent over the five years.

Employees in those sectors enjoyed annual pay rises despite the contractio­n of the economy.

Those in finance and insurance earned a median income per month of HK$31,600, which was 60 percent higher than the city’s median.

Alexa Chow Yee-ping, the managing director of AMAC Human Resources Consultant­s, said the poor pay rise for the retail and tourism sectors was related to their slow rate of post-pandemic recovery.

She suggested travel agencies should revise their business strategy in a bid to boost business levels.

“For travel agencies, it is important to figure out what people really want and diversify the products — maybe some new routes and special tours,” Chow said.

She added that younger people tended to book flight tickets and hotels on their own, so travel agencies could develop more flexible and tailored products, or focus more on packages for older people.

“For destinatio­ns that may raise safety concerns, tourists tend to turn to travel agencies for guidance and protection,” Chow explained. “Those areas are where travel agencies can put effort into when designing products.”

Shiu Ka-fai, a legislator representi­ng the wholesale and retail sectors, added that landlords could help retailers out.

“Landlords and developers may consider reducing the rent for retail businesses, which could help those retailers offer cheaper prices and other benefits to attract more customers,” he said.

 ?? AFP-Yonhap ?? People shop at a market in Hong Kong, Feb. 6. Hong Kong is eager to recover its status as a top tourist destinatio­n.
AFP-Yonhap People shop at a market in Hong Kong, Feb. 6. Hong Kong is eager to recover its status as a top tourist destinatio­n.
 ?? Reuters-Yonhap ?? Mainland Chinese tourists take photo of the skyline of buildings at Tsim Sha Tsui in Hong Kong, May 2, 2023.
Reuters-Yonhap Mainland Chinese tourists take photo of the skyline of buildings at Tsim Sha Tsui in Hong Kong, May 2, 2023.

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