• Thu
  • Aug 21, 2014
  • Updated: 4:59pm
NewsHong Kong
EMPLOYMENT

Government subsidies proposed to end shortage of skilled labour

Proposal for subsidies to help industries hit by a shortage of skilled labour bring in trainees set to be outlined in chief executive's policy address

PUBLISHED : Friday, 03 January, 2014, 3:59am
UPDATED : Friday, 03 January, 2014, 9:07am

Industries hit by a shortage of skilled labour could be offered government subsidies to attract trainees by raising wages.

The idea has arisen with more school-leavers shunning manual jobs to attend university.

A source close to the government believed Chief Executive Leung Chun-ying would address the issue in his policy address on January 15.

Sectors set to benefit include electrical work, lift maintenance and car and aircraft repairs.

These are identified as industries struggling to attract young people because of the relatively low starting wages and harsh working environment.

The extent of the subsidies needed was unclear, but the source said the extra costs would be shared by both the administration and employers. "Companies should shoulder some of the responsibility for grooming fresh blood," the source said. "It will alleviate their staffing problems in the long run."

A trainee electrician makes about HK$8,000 a month, less than half the wages of a fully trained and registered colleague.

Typically, it takes about six years to complete the training and apprenticeship.

But demand in the industry is rising because of the many new jobs being created by the expansion of the MTR and construction of the high-speed-rail link to Guangdong.

Wong Kam-fai, chairman of the Electrical Engineering Professional Employees Association, welcomed the idea of subsidies.

He said the industry, which employs about 70,000 people, would have to rely on imported labour if no effort was made to train young locals.

Wong attributed the labour shortage to the increasingly common practice of big companies outsourcing work to contractors.

"Small companies with limited resources don't bother to train newcomers. Their contracts are project-based so they don't have long-term vision," he said.

"On the other hand, parents don't like their children giving up academic study for vocational training. Youngsters don't like working in buildings without air-conditioning or works involving heavy labour."

In the UK, a planned upgrade to utilities infrastructure is set to see spending in the sector surge by £100 billion (HK$1.28 trillion) up to 2023, but companies in the industry say the county lacks the 200,000 skilled workers needed to do the jobs. The UK government has now injected more than £1 billion into a scheme to create 100,000 apprenticeship places.

The Hong Kong government has noted in its population policy the need to change the mentality of Hongkongers who place academic education before vocational training.

It will encourage employers to take a more active role in technical education.

The government hoped to revamp a four-decade-old apprenticeship scheme and tackle challenges brought by an ageing population and shrinking workforce, the source said. It is also determined to use all available local labour before considering importing workers.

The unemployment rate of 15- to 24-year-olds remained high at 9.7 per cent in 2012, compared to the overall average of 3.5 per cent. The figure does not take into account about 30,000 not engaged in employment, education or training, a population policy consultation document released in October showed.

 

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This article is now closed to comments

caractacus
If there is a shortage of labour the obvious solution is for companies to pay higher wages and pass the cost onto customers. Why should the taxpayer subsidise this? We already get the shaft from sky high rents and property prices rigged by the Government and property developers.
The same thing applies to importing cheap labour - how will these people find anywhere affordable to live? Will Paul Chan Mo Po's wife rent them cubicles at rack rents?
johnyuan
To car....
.
All points are valid. More, the government’s subsidy should be a temporary measure to jumpstart the revitalization of local labor supply. The government should maintain its stance stopping importing cheap migrant workers forcing and allowing the business and workplace to take in less profit and pay more to labors respectively. I would also go along that consumers should pay more for businesses that profit margin already are low. We should be ashamed for exploiting cheap labors otherwise.
.
With CY Leung’s bold step, some of our young folks will have a future. Remember not everyone can be a stock broker or a real estate broker. Besides, how problematic already it is with 30,000 of the latter.
lainy
Hong Kong parents want their kids to get a unless degree rather than working with their hands. The older generation look down on vocational trades. They encourage their children to go into financial industry. Selling mutual funds, life insurance, foreign exchange, and mini-bonds are more profitable than real meaningful work that makes our lives better. The government keep pouring money into universities and glorifing university education through an antiqated public examination system. The employers treat their workers like dirt. Why should anyone want to be a tradesperson?
johnyuan
To lai..
.
It is the expectation of parents that pushes youngsters away from labor work especially those who have spent inordinate amount of money on education. Innate inclination and ability are overlooked. Such expectation may have the root planted in Chinese culture where education is seen as a means for a prosper living. Despite 2000 years in exalting education, the narrow practical purpose of education in Chinese culture can be deemed as still in its very primitive state.
.
The contrast with US is just too big. Just reported in WSJ, waiting on tables in upscale restaurants nowadays include Harvard graduates. They see themselves as professional and building their career in food business by working from the bottom up. Anecdotally, my friend’s neighbor who is a builder (houses) with a hammer in hand is a Harvard graduate too.
.
I would say Hong Kong parents should free their children. Let the purpose of education has a wider scope in meaning and application. Only a restrictive way seeing education would make education useless.
ray1974
I see a wide trend that companies are less willing to invest in the future of potential workers and more cutting cost just to save some money on the short term. And are now caught in between the void with shortage of skilled labour and workers about to retire without anyone skilled enough to pickup the work. Also the Chinese way of not passing knowledge, as it erodes their value in the company has something to do with it. And the knowledge is lost when they retire.
captam
I blame the former polytechnics for becoming snobbish and elevating them themselves to second rate universities. The old higher-diploma courses which comprised more on-job practical training ( including part-time stints with outside companies) produced better trained workers, who were able to actually perform a useful function immediately upon leaving college.
Nowadays "graduates' with their watered-down and debased "degrees" are instilled with the mentality that they are all trained as "managers" and shouldn't get their hands dirty. Only the best and intelligent workers, who have proven themselves within industry over a number of years should be selected to go back to do a degree course in management training. The old-fashioned way was far superior and produced highly skilled workers worthy of salaries which were little below that of their foremen, superintendents and managers.
This is because of the gradual slide into decadence by the education "industry" who are now driven by mainly financial motives, emphasizing quantity rather quality of education.
johndoe
NO NO NO, I do not want to see any of MY hard earned TAX money to be given away as corporate welfare! Those corporations have to pay decent wages based on market rates! That would encourage workers to switch fields and learn new things. If they cannot charge enough to pay those wages, they need to raise their contract bids from the very beginning instead of using false advertising tactics of undercutting bids without any connection to real costs. Then, the government can scale back these infrastructure efforts to match what the productive capacity of the market can handle. There is no need to build all those roads all at once.
Let us all say no to corporate welfare!
yunkpoon2
Agree. It is not making sense that the government inject public money to private companies for there revenue. These workers are working for private companies, not for the government or society. It is companies' responsibility to pay for they used. Rather than giving subsidy to these company, the government should put a limit on the number of imported worker visa each year.
THC
Any statistics to show that the manpower source is dwindling because of university enrolment? I am skeptical that this magic wand will work. It is only trying to divert the source of manpower from trend to another and so the other industries will be suffocated. Unless you raise the fertility rate(maybe too late now) the other solution is bringing in more foreign talents. There is no two way about this.
Dao-Phooy
This is suppose to be 'the No1 free market in the world' - if so then employers in HK do not need government handouts from taxpayers!

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