CONSTRUCTION machinery and office equipment are leading the way as Hongkong's investment in automation and mechanisation increases dramatically. Investment in machinery and equipment grew 28.5 per cent to $11.18 billion in the third quarter of last year over the same period in 1991, according to the latest figures issued by the Census and Statistics Department. The first two quarters of last year also saw double-digit growth. The head of economic research at the Bank of East Asia, Mr Benjamin Chan Sau-san, said: ''Office automation is being stepped up to increase productivity and reduce the need for labour.'' Jardine Office Systems director Thomas Wan Yiu-ming estimated the market expansion of office equipment at 15 to 20 per cent last year. Office machines were more widely used as they became cheaper due to keener competition and wider production. ''They're now affordable to more people,'' said Mr Wan. Personal computers, for instance, were 30 per cent cheaper last year than in 1991. The average price of other equipment - including fax machines, typewriters and photocopiers - was down 10 per cent. Individual buyers accounted for most of the sales increase. An estimated 10 per cent of last year's sales was made to individual buyers, compared with about five per cent in 1991. The construction sector also accounted for a large part of the investment increase in machinery and equipment. ''The increase in infrastructure and reconstruction projects, such as those related to the new airport, calls for a growing amount of construction machinery,'' said Mr Chan of Bank of East Asia. ''And as greater amounts will be spent on public works in the coming year, investment in construction equipment will increase by an even a greater percentage.'' Financial Secretary Hamish Macleod has forecast spending of $31.57 billion on public construction projects in the coming financial year, up 52.5 per cent on the estimated $20.7 billion in 1992-93. ''Rising labour costs have also had a part to play in driving the industry towards a greater degree of mechanisation,'' said Mr Chan. Last year labour and material costs for the construction industry rose 7.1 per cent, most of which was on labour. Growing mechanisation is reflected in the turnover of equipment suppliers such as Jardine Engineering Corp. Sales by its industrial systems department, which supplies hoists and cranes, grew 25 per cent last year over 1991. ''As the Government is implementing environmental control, the amount of machinery needed to install such control devices and environmental-friendly systems also rises,'' said department sales engineer Leo Lo Yuen-kai. ''Demand from the private sector is also growing, though not as fast as that from the Government.'' The manager of the group's construction equipment department, Mr Jimmy Chu Kim-yu, said the increase in demand was due to the economic situation and increased labour costs. ''In recent years, inflation in equipment costs has not been as fast as that in labour costs,'' said Mr Chu. ''People would rather invest in machines than hire more workers.'' Mr Chu attributed a moderate five per cent annual increase in the cost of material-handling equipment in the past few years to cut-throat competition in the industry. ''Now we must count ourselves very lucky if we have a profit margin of six per cent,'' he said. ''We used to make 20 per cent eight years ago.'' Industrial machinery saw only steady growth in investment as many factories had moved across the border, said Mr Chan. ''But there has been some increase because some industries still stay in Hongkong for the country-of-origin consideration,'' he said. Investment in machinery by Apac Industrial Co, a manufacturer of injection moulds, has grown 18 to 20 per cent annually since 1990. Director Locky Chu Kwan-lam said rising labour costs, particularly with the legal imposition of labour benefits, had led to the increased mechanisation. ''A worker's salary rose 15 per cent last year on 1991,'' he said. ''But labour costs, which include benefits, rose 20 per cent. ''We employ 75 workers here and we pay a skilled worker about $10,000 a month. But taking the extra benefits into account, we spend about $1 million on manpower every month.'' The factory takes on an additional five to six workers every year. Mr Chu said even more would be needed if it did not install additional machinery. ''We also buy more machines to cater for ever-increasing requirements and orders from buyers. Orders are not increasing as fast as our purchase of machinery, but we take a long-term view.''