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August 1995, Volume 2, Number 8

Hong Kong Unemployment

High rent and labor costs are driving many unskilled jobs to China. Hong Kong officials, accustomed to full employment, were shocked when unemployment hit an eight-year high of three percent in May. The government, which has traditionally taken a hands-off approach, has stepped up its efforts to help service workers find jobs.

In June, paging operator companies received permission to service calls from southern China, where wages are only $260 per month, instead of $1,100 per month in Hong Kong. Industry analysts expect the entire paging industry to move to China, a loss of 30,000 Hong Kong jobs.

An estimated 10 percent of Hong Kong's six million residents have taken out citizenship or the right to citizenship in another country as a protection for their families if the 1997 transition to Chinese rule is bumpy.

Hong Kong's minority groups with no travel documents except the British Dependent Territories Citizen papers or a British National Overseas passport are entitled to neither Chinese nor British nationality. These minority groups have no nationality or guaranteed right of abode; they can only remain in Hong Kong as long as the Chinese allow them to remain.

Many are Indians who expected the British government to welcome them to Britain but, as 1997 approaches, they are not being granted British nationality. They have lobbied British Members of Parliament for 10 years, hoping to get special consideration for British passports.

The success rate for minorities applying for British passports is about 60 percent, the same for the rest of the population--despite promises from the British government that the applications from non-Chinese would be only a fraction of the total. Many minorities say they want British passports, not to go the Britain, but to stay in Hong Kong. They also want an escape should things go wrong after the Chinese gain control of Hong Kong in 1997.

The UNHCR director warned that there is a possibility that Vietnamese boat people who do not return to their native home before the 1997 handover of Hong Kong, may be sent to re-education camps or jails on the Chinese mainland. In July, 1995, there were two incidents when some of the 22,000 Vietnamese being detained in Hong Kong escaped. Most were recaptured.

The escalation of housing prices in Hong Kong has made the average middle-class apartment in Hong Kong worth more than the minimum investment required to enter most countries under their business immigration policies.

Increasingly, Filipina maids in Hong Kong are working outside the home, a violation of their employment contracts. About 600 of the maids claim they are forced to work in violation of their labor contract by their employers. Last year, over 160 Filipinas were charged with unapproved employment. This year the numbers are expected to be significantly higher. The Labor and Immigration Departments encourage domestic workers to report their employers, but the Filipina maids fear losing their jobs, being jailed, and then deported.


Bruce Einhorn, "This tiger has a thorn in its paw," Business Week, July 24, 1995. Kevin Murphy, "Time to Go? Hong Kong's Middle Class Hedges Bets," International Herald Tribune, July 4, 1995. Kavita Daswani, "People with a passport to nowhere," South China Morning Post, July 3, 1995. Kevin Sinclair, "Bearing the brunt of double standards," South China Morning Post, July 3, 1995. Scott McKenzie, "Deported Viet helps to run II job racket," South China Morning Post, July 3, 1995.