Hongkongers fear for their jobs as Covid-19 pandemic sucks the life out of the economy: Standard Chartered survey

Hong Kong’s youth and self-employed feel less confident, says Standard Chartered’s regional head of retail banking
Threat of redundancy is much higher in Hong Kong than in mainland China or Taiwan

Coronavirus pandemic: All stories

Martin Choi

Published: 7:00am, 6 Aug 2020

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Hong Kong’s workforce is feeling the stress brought about by the Covid-19 pandemic. The city’s workers worry that they could be laid off at any time amid a weakening economy, striking a heavy blow to the confidence of the youth and self-employed, according to a survey by Standard Chartered.

Hongkongers were the most pessimistic about their prospects compared to those in Taiwan and mainland China, anticipating major changes to their employment over the next three to six months, including reduced pay and working hours, an online survey of 1,000 adults in each of the three markets last month found.

“One key trend is that younger people are a little less confident post-Covid, with 41 per cent of them in Hong Kong expecting redundancy,” said Samir Subberwal, regional head of retail banking for Greater China and North Asia at Standard Chartered, in an interview with the Post.

Overall, some 35 per cent of Hong Kong respondents feared being made redundant, compared to 24 per cent in China and 23 per cent in Taiwan. About 40 per cent of Hongkongers also expected reduced working hours, compared to 33 per cent in China and 38 per cent in Taiwan.

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It was no different either when it came to pay cuts, with 37 per cent of those surveyed in Hong Kong expecting a smaller pay cheque, compared to 33 per cent in China and 31 per cent in Taiwan.

“The self-employed are also feeling a little less confident [financially] than those with salaries. 48 per cent of the self-employed [in Hong Kong] thought they would probably have to increase their borrowing,” said Subberwal.

Hong Kong’s economy contracted 9 per cent in the second quarter compared to the same period last year. That was almost similar to the record 9.1 per cent drop in the first three months of the year, the steepest decline in a single quarter since records began in 1974. The city’s gross domestic product shrank for the fourth straight quarter.

Hong Kong’s unemployment rate has also climbed to its highest level in more than 15 years, hitting 6.2 per cent for the three months ending June.

“The economic situation is worrying” in Hong Kong, financial secretary Paul Chan Mo-po said in a blog post on Sunday.

Chan predicted that Hong Kong’s economy would face even greater pressure in the third quarter against the backdrop of a third wave of the pandemic which shows no signs of abating. He added that the city should learn from how mainland Chinese authorities handled the health crisis.

Both Taiwan and China had better control of the coronavirus outbreak than Hong Kong, which has seen more than 2,000 locally transmitted Covid-19 cases since the third wave began last month. Taiwan has only had 476 confirmed cases and 7 deaths as of Wednesday.

Meanwhile, Taiwan’s economy contracted by 0.73 per cent in the second quarter compared to the same period in 2019, and was forecast to grow 1.67 per cent for the whole of 2020, according to government statistics.

China’s economy also avoided a recession with GDP growth of 3.2 per cent in the second quarter. The world’s second largest economy shrank 6.8 per cent in the first three months of the year.

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