Poll shows people fear ravages of unemployment
A TIDAL wave of economic pessimism is sweeping through the territory, with the public in its darkest mood for a decade, according to a new poll.
Belief in better jobs and wage increases has given way to a general fear of stagnant incomes and widespread layoffs.
Meanwhile, improved relations with China and the democratic election of a new Legislative Council have done little to improve the public's view of the political situation.
These are the findings of a quarterly Economic and Political Confidence Survey produced for the South China Morning Post by Survey Research Hong Kong from soundings taken between October 2 and 6.
The survey's economic confidence index has plummeted in one year from a respectable 90 points (compared with the January 1985 base-line of 100) to an all-time low of 73, three points below the previous quarter.
The results drew an angry response from Democratic Party economic affairs spokesman Dr Huang Chen-ya.
'It is hardly surprising when people know unemployment is at a 10-year high, the retail sector is doing so badly and people hear of one company shutting down after another,' he said.
'The public was hoping Chris Patten would come forward with proposals to revive the economy in his policy address. But he didn't show any determination to fix anything.
'I think if you took the survey now the results would be even worse.' However, Financial Secretary Donald Tsang Yam-kuen defended the Government's record and warned against letting perceptions of 'subdued' economic sentiment blow out of proportion or 'become a self-fulfilling prophecy'.
He said the fall in the confidence index was disappointing but not entirely surprising given current feeling, which was 'conceivably caused, in large measure, by the increased unemployment rate'.
But the Government still expected the economy - which was 'not in a state of recession' - to grow by five per cent this year, he said.
There would also be significant growth in exports and sustained investment in machinery and equipment.
'The good export performance underpins our gross domestic product growth, while the ongoing investment momentum reflects business confidence for the future,' he said.
According to the survey, a record 53 per cent of the working-age population see the economic situation as bad, up from 42 per cent in July. Only four per cent perceive it as good. The rest say it is no better or worse than average.
Assessments of respondents' personal finances were hardly more optimistic. Just 11 per cent foresaw any improvement in the next 12 months compared with 17 per cent in July. Twenty-seven per cent thought things would get worse, an increase of 10 percentage points on October last year.
The only bright point on the personal finance skyline was a slightly more optimistic response from the 15-24 age group than the rest of the population - 18 per cent forecast an improvement.
But even that figure was down on last quarter by three points, and, as the survey points out, it is probably because much of this younger group has yet to join the working population and so has no personal income.
Not surprisingly, the improvement in the major purchases index over the summer, which suggested the slackening inflation rate was encouraging people to buy expensive items, has been wiped out over the past three months. It is back to the 81-point low of six months ago.
In contrast, the public's confidence in the territory's political future remains virtually unchanged from the summer, 63 per cent expressing some confidence.
Only 19 per cent saw the contribution of Legco as likely to be positive, while 21 per cent thought it would be negative. The rest thought it would make little difference either way.
The political confidence index remains stable at 87 points. Its low point was 82, reached in June 1989.
But another Post poll showed Hong Kong people's confidence had been weakened after the Legco election and the latest policy speech.
The poll showed the confidence of 47 per cent of respondents had fallen. But 37 per cent said their confidence was boosted.
Those aged between 18 and 24 were decidedly gloomy with 61 per cent saying confidence had been undermined.
Confidence in the Governor's ability to do a good job also shrank with 42 per cent giving a thumbs down.
And only 28 per cent supported the Governor's threat to veto legislators' private member's bills.
Meanwhile, as the Post reported yesterday, job-security worries loomed larger, with 30 per cent fearing they might be laid off compared with 19 per cent in July.
There was a slight improvement in respondents' assessment of their chances of finding another job if they were laid off.
But the shift was merely from bad to average; and the situation was completely reversed in the lowest income group. Only 16 per cent of respondents with an income under $10,000 per month thought they had a good chance of getting another job - less than half the number recorded in July.