Companies expanded their permanent staff by just 0.7 per cent year on year in 2004, but significantly strengthened their workforces with part-time employees - a sign that businesses may want to remain flexible enough to cope with economic uncertainties. According to the 2005 Manpower Planning Survey, conducted in February by the Hong Kong Institute of Human Resource Management, last year's increase in full-time employees reverses declines of 0.3 per cent in 2003 and 12 per cent in 2002. The turnaround in hiring was seen across all staff levels except for supervisory positions, which made up 15.2 per cent of permanent full-time employees last year, down from 25.9 per cent in 2003. The outlook for permanent staff growth in 2005 is 2.6 per cent, with almost half of the surveyed companies indicating a higher headcount this year. The flexible workforce also grew, accounting for 16.4 per cent of the total pool of workers last year versus 12.2 per cent in 2003. Out of the flexible workforce, part-timers made up 63.4 per cent, or almost double 2003's 35 per cent. Much of the increase was in the retail, telecommunications and social services sectors. The survey covered 82 companies and about 51,000 employees. 'The significant increase in hiring part-time staff reflects the continued efforts by certain sectors to manage the rapid changes in the business environment in a flexible way,' said the institute's research director, Sara Cheung Fung-yee. She added that a continued pickup in the economy might not necessarily lead to companies hiring more permanent staff at the expense of part-timers. City University associate professor of economics and finance Li Kui-wai agreed with the survey findings. He stressed that the rebounding economy would provide brighter prospects for part-timers, but that this might not be fully reflected in the underemployment rate. The rate measures people who cannot find more than 35 hours of work each week and remained unchanged at 3 per cent in May. 'The underemployment rate may actually rise as more people come out to find part-time work,' Professor Li said.