Wage growth in Hong Kong slowed this year as Guangdong province experienced a modest pickup, according to the 2026 Guangdong-Hong Kong-Macau Greater Bay Area Pay and Benefits Survey released on Tuesday. The survey, conducted jointly by Baptist University, South China University of Technology, the Hong Kong People Management Association, and the Talent Development and Management Association of Guangdong, reflects evolving regional labor market dynamics amid differing economic conditions.

The study, which gathered data between July and September from 78 companies in Hong Kong, 38 in Macau, and 105 across nine Guangdong cities, covering more than 270,000 employees, found that average pay increases in Hong Kong dropped to 2.3 percent this year from 2.5 percent in 2025. In Macau, wage growth slowed to 1.1 percent from 1.6 percent. By contrast, Guangdong’s average pay rise edged upward to 2 percent from 1.8 percent in the previous year. Companies in Guangdong anticipate a sharper rebound in 2027, projecting average salary increases of 3.8 percent, while firms in Hong Kong and Macau expect an average of 3.1 percent.

Despite the slower overall wage growth in Hong Kong, the government reported a slight increase in the city’s unemployment rate to 3.9 percent between July and September, a rise of 0.1 percentage points from the prior three-month period. This marked the highest unemployment rate since late 2025. However, Secretary for Labour and Welfare Chris Sun Yuk-han noted that total employment and labor force numbers continued to grow, supported by a “continued influx of fresh graduates and school leavers into the labour market.”

The survey also highlighted developments in starting salaries. Average entry-level pay for university graduates in Hong Kong remained steady at HK$19,500, while recent graduates in Guangdong typically earned 6,000 yuan (approximately HK$7,000) and those in Macau received 16,000 patacas. The salary range for Hong Kong bachelor’s degree holders was HK$17,500 to HK$23,000. Notably, the difference between starting pay for bachelor’s degree holders and sub-degree recipients narrowed by 17 percent to HK$2,500 this year, driven by higher starting salaries for sub-degree graduates, which rose to a range of HK$15,500 to HK$20,500 from last year’s HK$12,500 to HK$18,000.

Looking ahead, 41 percent of surveyed Hong Kong companies expect an average wage increase of 3.1 percent in 2027, while one firm anticipated freezing salaries. The remaining respondents did not provide forecasts. Industry observers suggest that despite ongoing challenges from external economic factors and cost pressures, businesses across the Greater Bay Area remain cautiously optimistic about future growth and talent demands.