Multi-pronged Approach to Enhance Speed and Efficiency Uphold Unity and Foster Communications for Our Industry’s Future

The Hong Kong Special Administrative Region celebrates its 26th anniversary this July. On the 1 July, the Construction Industry Council has hosted a Flag Raising Ceremony at the CIC-Zero Carbon Park, inviting guests to witness this special occasion together. Looking back, the landscape of the city has never stopped evolving. Major construction projects and landmarks are completed one after another, and public facilities are constantly being expanded and improved to benefit the community at large. The society has grown hand in hand with the construction industry. Hong Kong's "One Country, Two Systems" advantages remain robust and it continues to be one of the most competitive cities in the world.

However, as the Mainland and neighboring regions are developing rapidly, we must remain vigilant and remember the fact that "making slow progress is no different from falling behind". The process of development is never a smooth ride. It is inevitable to encounter obstacles and setbacks just like any journey. The most important thing is unity of all members of the construction industry. We should unite together sincerely and have engaging dialogues. We should also explore with an open mind and seek common ground that can both benefit the industry and individuals the most.

Urgency to Address Challenges Posed by Labour Shortage and Aging Workforce

The construction industry in Hong Kong is currently facing a structural shrinkage of the labour force as a result of the ageing population. This problem is not unique to the construction industry; other labour-intensive industries are also facing acute labor shortages.

The Hong Kong construction industry’s "Manpower Forecast” published by the CIC in February this year revealed a current shortage of about 15,000 to 20,000 skilled, semi-skilled and technicians in the industry. This shortage is expected to grow to 40,000 by 2027, reflecting an alarming situation. Another worrying issue raised in the report is the ageing of the industry's workforce. Currently, 45% of registered workers are over the age of 55, and most of these workers are expected to retire within the next decade. In addition, over 30% of the workforce is over 60 or approaching 70 years of age. Many industry practitioners have repeatedly expressed concern about this ageing trend in the industry.

With the Government’s planning of various large-scale developments and many infrastructure projects in the pipeline, including the development of the Northern Metropolis, the reclamation project of Kau Yi Chau Artificial Island, and the acceleration of public housing construction, these projects have created very promising opportunities for the construction industry. However, in order to seize the opportunity, we must first solve the problem of labour shortage. Driven by the Government's development policies, the demand for labour is expected to increase further. We are now facing an obvious bottleneck in the supply of labor, despite all the measures that have already been taken to solve the problem. We certainly do not want our city to miss out this golden chance due to a shortage of manpower, which would in turn jeopardise the quality of life of Hong Kong people. Moreover, we do not want to miss the opportunity for the construction industry to regain its glory days along with the strategic development of Hong Kong.

Adoption of new technologies to create jobs

The CIC has been closely monitoring the labour supply and demand situation and has been working with the industry to identify and promote various solutions to meet manpower needs.

In recent years, the CIC has been proactively promoting various technologies to enhance productivity and improve the working environment of the construction industry, such as Modular Integrated Construction (MiC) and Building Information Modelling (BIM). Training sessions, master classes, competitions and field studies are conducted to enhance the industry's mastery of these new technologies. As a result, new technology-oriented jobs have been created and the industry's heavy reliance on intensive labour has been reduced. The CIC also actively facilitates technology exchange between local and overseas practitioners, assisting the introduction of innovative construction technologies to improve productivity.

However, technological advances and the training of local talent are still not keeping pace with the manpower needed to sustain the city's development. When there is an elephant in the room, all responsible managers and entrepreneurs should take action to address the issue immediately. Only by acknowledging the situation can we effectively address the problem. I believe that being open-minded and willing to face challenges, together with a multi-pronged approach and decisive action, will ultimately benefit the long-term development of the industry.

Labor Importation to Address Labour Challenges

Last month, the Government announced the Labour Importation Scheme for the Construction Industry (the Scheme) to help alleviate the industry's pressing manpower needs. The CIC believes that it can help the industry address its manpower challenges while streamlining the application process and protecting the rights of local workers.

The Scheme takes account of the interests of local workers in several ways. First, the quota for imported workers is capped at 12,000. There is also a requirement for a 1:2 ratio of imported workers to local workers to ensure that local workers are given priority in various construction projects. In addition, the wage level of imported workers cannot be lower than the median wage for the relevant positions in Hong Kong, a measure to protect the income of local workers.

When allocating the quota of imported labour, priority will be given to applications from public works projects, especially those related to land development, infrastructure, public housing, railways, airport projects, hospitals and other projects that serve public interest and are under the supervision of government departments or related statutory bodies. Under this Scheme, imported construction workers are required to work on the approved projects and their respective construction sites.

Local workers can also benefit from this Scheme. Employers are required to allocate at least 10% of the approved imported labour quota as additional training quota for local workers. In addition, employers are required to pay the "Employees Retraining Levy" of HK$400 per imported worker per month. This levy fund will go directly to the Employees Retraining Board to support the provision of training programmes to meet the needs of local workers. This will ensure that the training needs of local workers are met during the implementation of the Scheme.

To better support the Scheme, the CIC will proactively follow up and monitor its implementation. This includes reviving the "Short-term Labour Supply Task Force" (the "Task Force"), which is composed of representatives from relevant labour unions and trade associations. After thorough consultation with various industry stakeholders, including contractors and labour unions. Members of the Task Force will jointly discuss the types of qualified and in-demand trades, their median wage levels, and detailed implementation plans. The CIC will then forward the stakeholders' recommendations to the Government.

Strengthening Training for Local Workers

The CIC cannot stress enough that the problem of labour shortages cannot be solved by importing labour alone. It can only be adequately addressed through various measures in the long run. In the future, the CIC will intensify a series of initiatives, including manpower training, technology application and productivity enhancement, with a focus on training local workers and attracting more young talents to enter the industry.

The CIC will also use the Government's approved allocation of HK$1 billion funding in 2022, in addition to available internal resources, to provide an additional 4,000 training places for new skilled workers from 2022-23.

In terms of technology adoption, the CIC will continue to promote Building Information Modelling (BIM) and Modular Integrated Construction (MiC) . The CIC will also encourage the use of other construction technologies through the Construction Innovation and Technology Fund (CITF), such as the use of robotics and automated equipment to increase productivity and reduce manpower needs.

To support implementation of the Scheme, the CIC will optimise the use of non-local resources and actively participate in related follow-up work. We will collaborate closely with contractors, labour unions and other industry stakeholders to voice out their concerns and suggestions to the Government.

Riding on the opportunities brought by the National 14th Five-Year Plan and the strategic development of the Greater Bay Area, I believe that Hong Kong will continue to shine brightly on the global platform as a free, open and inclusive international city. The CIC will continue to work hand in hand with the industry and labour sectors to support the successful implementation of various large-scale infrastructure and engineering projects in Hong Kong, and push forward to contribute to the high-quality development of our country and Hong Kong.

We also wish that Hong Kong will continue to thrive and be the ideal place for people to live and work as it enters a new phase of transition from stability to prosperity. May the city's economic development and people's livelihoods continue to flourish as we embark on this new chapter together.