Legislation on standard hours won’t solve problem of a long working day
Shirley Yuen says real issue is labour shortage, which can be eased by reducing SMEs' tax burden
Standard working hours will not, we believe, alleviate the problem of excessively long hours, and legislation risks lowering the flexibility of the labour market, as well as constraining Hong Kong's competitiveness and economic development.
To boost the economy, the government should use tomorrow's budget to reduce the profits tax rate and implement a two-tier tax system to ease the burden of small and medium-sized enterprises (SMEs).
The issue of long working hours is due to the severe labour shortage, and the solution to that problem is increasing our labour force
The issue of long working hours is due to the severe labour shortage, and the solution to that problem is increasing our labour force. According to government statistics released this month, Hong Kong's unemployment rate stood at 3.1 per cent in the November 2013 to January 2014 quarter, down slightly on the previous quarter, while underemployment also fell, to 1.3 per cent. If current trends continue, the jobless rate will fall below the 3 per cent threshold for the first time since 1997.
We might be heading down that road again, as the number of vacancies has been rapidly increasing for more than a decade - except for a slight change in direction in 2008 due to the financial crisis. To put it in numbers, in December 2002, the number of vacancies stood at 16,216, according to figures compiled by the Census and Statistics Department. This had more than doubled, to 36,507 by December 2007, and has continued to rise, to 78,299 last September (the latest figures available). This data clearly shows Hong Kong is suffering from a severe labour shortage, and stipulating standard working hours will only make it more difficult for companies to survive.
Moreover, overseas experience shows that standard working hours generally force employers to hire more part-time or casual employees, which will fragment jobs and exacerbate underemployment.
We support the policy objectives that proponents of standard working hours are trying to achieve, but we do not believe that introducing legislation will solve the issue of long hours. With Hong Kong's robust economy and acute labour shortage, legislation will stretch our labour market even more thinly, push up wages and increase SMEs' operating costs.
The government should uphold the free-market economy principles on which Hong Kong has thrived. Rather than standardising working hours through legislation, employers and employees should draw up contracts based on the demands of work in individual sectors, stipulating job requirements, duties, working hours and arrangements for overtime pay.