Hong Kong’s poorer workers can profit from the Greater Bay Area, with the right skills

Gary Lai calls for a sizeable allocation of scholarship and grant money for vocational training for Hong Kong workers, so that they can benefit from the higher wages and technological shifts brought by increasing development in the Pearl River Delta

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A worker checks cotton thread barrels in a textile factory in Huaibei, Anhui province, one of the major sources of migrant workers to the more prosperous and developing parts of China, such as the Pearl River Delta. But rising wages, increased reliance on automation and changing technology may put their jobs on the line. Photo: AP

Published: 12:58pm, 3 Nov 2017Updated: 12:58pm, 3 Nov 2017

Given the tremendous promise in the development of the Pearl River Delta – or the Guangdong-Hong Kong-Macau “Greater Bay Area” – there is certainly something in it for the poor people of Hong Kong, if not the rest of the delta. Right? Not quite.

Covering less than 1 per cent of China and comprising only 5 per cent of its population, the Pearl River Delta produces more than 10 per cent of the country’s gross domestic product, exports more than 25 per cent of the total, and has attracted over US$1 trillion of foreign direct investment since 1980. The region has a higher per capita GDP than the Bohai Economic Rim and the Yangtze River Delta and serves as an important link between China and the world.

Yet, the factors that are prompting great shifts in the economy for the better are also keeping the poor and under-educated from sharing in the windfall.

GDP per capita in cities in the Greater Bay Area, 2016. Source: Municipal bureaus of statistics, Wind Info; Factiva; PwC analysis

First, the labour pool in the Pearl River Delta is shrinking and, as a result, wages are rising. Therefore, factory owners are moving their plants to cities – not necessarily within the delta – with better labour conditions. This would require job-seeking workers to be as mobile as these factories. This is not reasonable to assume for poor people, especially when they may have hukou (household registration) restrictions.

At worst, poor labourers are unable to acquire the new skills and lose their jobs

Companies, in order to diversify, are also redirecting their exports to the Chinese market. At best, this phenomenon is a wash for labourers, if they do not need to retrain for this market shift. At worst, poor labourers are unable to acquire the new skills at work and lose their jobs.