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Fiona Sun

Edith Lin

In the fourth of our series of previews on the five-year plan and policy address, to be announced on September 16, Fiona Sun and Edith Lin analyse how to improve livelihoods in the city by tackling the impact of demographic changes and technological advancement. Read part one here, part two here and part three here.
Twenty-eight-year-old Hong Kong resident Fong and his wife want to have a child but he knows they cannot afford one for now.
He earns about HK$10,000 (US$1,275) a month as a construction worker and lives in a subdivided flat in Prince Edward, paying roughly HK$3,000 a month for the 100 sq ft space. His mainland Chinese wife, 27, remains in Guangdong province as she waits for a one-way permit to be in Hong Kong with him.
With unstable working hours and wages, Fong said he struggled to make ends meet. The cost of raising a child in one of the world’s most expensive cities is too heavy a burden to bear for now.
“If you bring a child into the world, you have to raise them. It’s not something to be taken lightly,” he said.
“It requires real commitment and a good environment for the child to grow up in.”
Fong is among the thousands of Hongkongers who are staying child-free as reflected in the city’s record-low births, with residents wrestling over their financial woes, housing constraints and concerns over access to education and the lifestyle trade-offs they have to make to have children.

The government is under mounting pressure to tackle the larger issue of the city’s population targets as it grapples with not just declining births but also a rapidly ageing society. This double whammy creates a high age dependency ratio, where a small number of working-age people are supporting a much bigger population of elderly or the very young.
At the same time, Hong Kong faces fiscal constraints, making the challenge that much harder to tackle, experts say, as they await measures to be announced in Wednesday’s policy address and the city’s first five-year plan.
Chief Executive John Lee Ka-chiu is expected to announce policies to improve livelihoods. Observers say the approach should go beyond welfare provisions, offering a holistic strategy that includes job creation and new industries for new vocations as old ones are absorbed by emerging technology.
Upskilling the labour force, leveraging emerging industries for job creation and unlocking the hidden workforce were critical to resolving the deep-rooted problems without disrupting social harmony, they said.




“Hong Kong’s labour force is facing impacts from an unstable exterior economic outlook, an unequal interior development, technological transformation and the government’s deficit and ensuing cut in public resources,” said Au Yeung Tat-chor, an associate professor in the department of sociology and social policy at Lingnan University.
“As we are facing a hard-to-change trend of declining birth rates, it is time to think of ways to allow the local population that was originally marginalised or excluded from the workforce to re-engage in the labour market, which will benefit both society and the economy.”
Official statistics showed that the city’s labour force stood at 3.79 million people between May and July this year, down from the 3.81 million recorded for 2025.
Record-low births
Hong Kong recorded 29,700 births between mid-2025 and mid-2026. It is the first time the city has had fewer than 30,000 births in its midyear population update since official records began in 1962.
The number of births continued to shrink despite the HK$20,000 baby bonus, tax relief and public housing perks.
Experts warned that increasing financial rewards was unlikely to work, even as others pointed to the Singapore government’s recent push towards more generous pro-family measures.
The centrepiece is a new scheme that will provide almost S$70,000 (US$55,255) in direct financial support for each Singaporean child until age 17.
“First, we cannot mechanically replicate the amount and second, we need to assess how many families could be incentivised and determine the threshold – how much is needed – for them to have children,” said Eric Fong Wai-ching, chair professor in sociology at the University of Hong Kong.

He added that financial incentives tended to work mainly for the working class, while better-off households might be less responsive as considerations other than money carried more weight.
Fong called for a review of existing pro-family measures, and urged a more comprehensive population policy as it would require other supporting measures to sustain the population and hence the economy.
Nelson Chow Wing-sun, an emeritus professor at the University of Hong Kong’s department of social work and social administration, said the city should prioritise attracting those from the mainland – whether for family reunion, imported labour, study or work – an advantage the city held over other low‑fertility regions.
“Hong Kong’s population growth has been driven by people coming from mainland China rather than birth rates,” he said. “This is something Singapore does not have.”
But he cautioned that cross-border migration must be conducted in a well-planned and structured manner to avoid creating new problems.
Official statistics showed that the city had approved more than 462,000 applications through various talent admission schemes since 2023, with about 340,000, or 73 per cent, from the mainland.
To fill the labour shortages, the city has also approved more than 122,000 applications through various labour importation schemes since 2023.
Imported labour to supplement, not to replace
But the schemes have also come at a cost. Sze Lai-shan, deputy director of the Society for Community Organisation, argued that labour importation had compromised the jobs of low-income locals.
Under the Enhanced Supplementary Labour Scheme, employers may apply to import workers for 26 low-skilled job categories, but they must first conduct local recruitment.
Operators in most industries must complete a four-week local recruitment exercise and maintain a staffing ratio of two local workers for each imported labourer.
From mid-June, the catering sector faces a tougher staffing ratio and a longer local recruitment exercise in a bid to force it to turn first to locals.
Sze pointed out that the scheme had not set a cap for each industry, while operators also could cut local staff’s working hours and salaries.
She proposed setting a quota and halting applications for industries with an unemployment rate of at least 4 per cent.

Kenny Shui Chi-wai, vice-president of Our Hong Kong Foundation, a think tank, suggested extending tougher labour importation rules to sectors with high unemployment rates and high vacancy rates.
“The public expects that imported labour is a way to supplement local labour, rather than replacing local workers,” he said.
“When it is unbalanced, authorities can consider halting the labour importation or adjusting the mechanism to safeguard the local workforce.”
Leveraging AI and emerging industries
Beyond imported labour, rapid technological change also imposes challenges on local workers.
Shui warned of the relatively high unemployment rate among the younger generation, who were generally educated but faced challenges of companies replacing junior positions with artificial intelligence (AI).
Between May and July, the city’s unemployment rate stood at 3.8 per cent, but it reached 14.6 per cent for those aged 15 to 19 and 8.4 per cent for 20- to 29-year-olds.
Shui struck a positive note about the long-term employment market, as technological advancement would not only replace jobs but also create new ones, just as programming occupations were created with the invention of computers in the past. It is the transition period that the government needs to be attentive to.
“However, the market needs to adapt in the short term,” he said, noting that upskilling and AI education were the solutions.
He urged the government to devise courses to upskill labour after studying industry trends and the impact of technology.

Leonard Chan Tik-yuen, founding chairman of the Hong Kong Innovative Technology Development Association, said the workforce should boost its AI literacy, professional knowledge, and interdisciplinary and communication skills to embrace new job opportunities ahead.
While technology had replaced occupations with repetitive duties, it created new roles in AI compliance and regulatory work, as well as technicians for automotive and advanced wearable devices, Chan said.
Chan added that new roles for programming and managing machine operations had also emerged as AI was applied in manufacturing and new industries for quality assurance and customer service.
The government has also promoted smart manufacturing and new industries such as microelectronics, new energy and new materials in recent years, which are expected to create new jobs.
“The industries and the government should think about how to set rules, make data available and provide application scenarios that AI empowers people, rather than replacing them,” he said.
“It is about using AI to shorten employees’ working hours so that they can manage [a greater number of] AI agents. Employees will be happier, while productivity will improve without affecting the budget.”
He added that new application scenarios and occupations would take time to evolve, urging workers to develop comprehensive skills and engage in new paths as technology shortened their working hours.
Unlocking potential labour
Au Yeung from Lingnan University said the city’s five-year plan should focus on unlocking segments of the local labour force that remained underutilised, including older workers and women.
According to the Census and Statistics Department, the labour force participation rate of women, excluding foreign domestic helpers, was 47.3 per cent in the second quarter this year. The figure for people aged 60 and above was 22.7 per cent, while that for those aged 65 and over was 13.5 per cent.
A key hurdle to be removed, he noted, was raising the retirement age.
He said the current policies encouraging older people to return to workplaces relied heavily on short-term allowances as incentives, which had limited effect. Instead, he called for a long-term strategy that combined financial support with services and training programmes to help older people build new skills and networks.
“Hong Kong’s labour force participation rate among the elderly is low, compared with some neighbouring mature economies,” he said.
He called on authorities to set key performance indicators aimed at raising the labour force participation rates for the elderly and women.
To ease women’s caregiving burden and facilitate their return to work, more public childcare services should be provided – especially for toddlers aged under three – while a more flexible working environment tailored to their needs, such as additional parental leave, was also needed, he added.

Lawmaker Lam Chun-sing, also the chairman of the Federation of Hong Kong and Kowloon Labour Unions, urged the government to roll out extra subsidies and support for certain demographics, such as single parents, who are one of the three groups already targeted under its poverty alleviation policies.
“Employment can help alleviate poverty. If single parents enrol in courses, you can offer extra subsidies to entice them to seek jobs. Meanwhile, the government has to strengthen childcare support, allowing parents to have more time for retraining and employment,” he said.
“The city should aim to build a family-friendly working environment so residents can earn a living without affecting their family life.”
If such conditions improved, workers such as Fong said they would be more motivated to have children.
More cash allowances would help, Fong added, while affordable childcare would allow his wife to work and earn an income.
“All we hope for is to provide a good life for our child,” he said.


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Experts say this week’s policy address should go beyond welfare provision, offering strategy for job creation and upskilling the workforce


Experts say this week’s policy address should go beyond welfare provision, offering strategy for job creation and upskilling the workforce.


How to solve Hong Kong’s triple whammy: ageing population, baby dearth and job losses?

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Experts say this week’s policy address should go beyond welfare provision, offering strategy for job creation and upskilling the workforce

Experts say this week’s policy address should go beyond welfare provision, offering strategy for job creation and upskilling the workforce