How cheaper transport fares can help Hong Kong’s economy regain its edge
Po Chung says the mismatch between workers and jobs is dulling the city’s competitiveness, and the government should make travel more affordable to improve mobility
To halt the declining competitiveness of Hong Kong, it is crucial that we critically review our past success in urban planning and adapt to new challenges.
Hong Kong’s economic miracle was born of a seamless pairing between jobs and people. In the past, subsidised housing was matched with subsidised factory space in newly built satellite towns, empowering people to take up all manner of jobs – some worked in factories while others, mainly children and housewives, took up part-time work at home, such as making plastic flowers. Voila! We became one of the “four Asian dragons”.
Today, the economic structure has changed. A vibrant service sector now employs most of the city’s workforce and, increasingly, we don’t live where the jobs are.
More Hongkongers are living in outlying areas like Tung Chung, Fanling, Yuen Long and Tuen Mun, where housing is more affordable. By contrast, jobs in the service sector have largely remained in the city centre – in places like Central, Admiralty, Tsim Sha Tsui and Causeway Bay. Meanwhile, the satellite towns are not producing enough jobs to be self-sufficient.
As a result, people now spend more time travelling between work and home. The longer commute pleases no one. Workers pay more in terms of time and transport fare, while companies find it more difficult to hire workers.
Thus, I applaud the government for championing the idea of a compact city in the Hong Kong 2030 Plus blueprint for the city’s development. People’s views are being sought on the plan, and any change will take some time to materialise.
In the meantime, we need an interim solution to the job-home mismatch.
The old model is no longer effective at pairing available workers with available jobs. We need an innovative solution. This is vital for a service-oriented economy like Hong Kong’s.
The answer is an inexpensive transport system that connects the right worker with the right job. Offering the occasional discounted fares, as some transport operators do now, is simply not good enough. We must think in terms of having a mobile workforce. This means providing a cohesive transport system at reasonable fare. Whether people travel by bus, MTR, minibus, shuttle bus or taxi, or a combination of these, to get to work, they should be able to do it easily and at no great cost.
In recent years, the lack of social mobility has been a topic of debate. I believe that by improving our physical mobility, we will also improve people’s social mobility, and this can only be a good thing.
Paying less for transport means workers can enjoy a higher take-home pay; it’s a pay rise that won’t cost employers an extra cent.
It will also allow workers to widen their choice of employment, and they will be more encouraged to apply for positions that truly reflect their career aspirations and capabilities.
Employers, too, will benefit, by having a more steady supply of workers.
The government should support the city’s transport operators to make an across-the-board reduction in fares. Some would argue that such a subsidy would lead people to abuse the system, but I disagree. People would not travel a longer distance simply to take advantage of a government benefit.
Yet others may question whether such a welfare scheme would be sustainable. Look at Beijing, the sprawling capital city of our nation, where many people have to travel great distances daily for work. Despite the distances, the subway operator has kept prices low. A ride cost only 2 yuan (HK$2.30) until 2014, when the fare was raised slightly.
A subsidy programme can be compatible with fiscal discipline. Moreover, Hong Kong has one of the largest fiscal reserves among economies worldwide. If the government could invest half of the city’s Future Fund into the financial market, I see no reason why it cannot invest in the Hong Kong people for greater prosperity.
Po Chung is co-founder of DHL International and founder of the Hong Kong Institute of Service Leadership and Management