Poor struggle as rich prosper, study shows

PUBLISHED : Saturday, 05 May, 2007, 12:00am
UPDATED : Saturday, 05 May, 2007, 12:00am

Low earners are being left behind as the economy continues to improve, while the middle classes are surging ahead, a survey has indicated.

Households with a monthly income of less than HK$20,000 lacked the means to improve their lot and had less confidence in the future, the New Forum study found.

The government-friendly group, which polls the public every quarter on economic confidence for the six months ahead, saw a general decline among the 2,221 respondents polled between January and March.

People were generally still optimistic, with a score of 101.7 - just above the 100 mark which shows a positive attitude, but down from 106 in the same period last year.

The lower-income group remained the most pessimistic, with a confidence level of 94.4 - down from 99.5 last year. An index measuring the conditions of their household finances saw a drop from 84.8 in the first quarter last year to 83.8.

Meanwhile, those earning between HK$20,000 and HK$70,000 were not only positive about their economic future, but their household financial conditions jumped to 113 from 109.2 - the biggest increase since the survey began in 2004.

Respondents were also spending more, with a higher portion of people investing in stocks and shares and buying more household goods.

Some 5.1 per cent of respondents said they would buy a property in the next six months, compared with 4.5 per cent in the same period last year.

Forum board member Hsu Hoi-shan said the middle classes would continue to be the major driving force for consumer spending after a string of policies announced in the budget that benefited them greatly.

Financial Secretary Henry Tang Ying-yen provided tax rebates and other concessions worth HK$20 billion, prompting criticism that he was biased towards the middle classes.