Hong Kong’s workforce is projected to decline by approximately 20,000 workers annually through 2028, according to a recent government report, despite ongoing efforts to attract foreign labor and imported talent. The report warns of persistent manpower shortages in several key industries, particularly in sectors requiring skilled technical workers.

The government’s manpower projections indicate the labor shortfall will shrink to around 130,000 by 2028, a reduction from an earlier estimate of 180,000. However, acting Secretary for Labour and Welfare Ho Kai-ming emphasized that critical areas such as innovation, aviation, construction, city operations, and healthcare will continue to experience significant talent gaps. He also noted that the adoption of artificial intelligence (AI) is expected to accelerate, leading companies to be more cautious in hiring entry-level roles, which may ease demand for these positions and restructure some clerical jobs.

The report forecasts a decline in the city’s workforce from 3.47 million in 2025 to 3.4 million in 2028. Workers aged 25 to 34 are expected to decrease by 64,000 over the same period. Without measures to supplement the local workforce through imported labor and talent, the workforce could shrink further to 3.21 million, with the labor shortfall reaching 300,000 amid an aging population.

Roy Chan Kwok-fai, head of the Labour and Welfare Bureau's research unit, highlighted a growing mismatch between job requirements and job seekers’ expectations, contributing to unfilled vacancies despite elevated unemployment—now at 3.8 percent with over 150,000 unemployed individuals. Chan said the number of unemployed persons affected by this mismatch has increased to 30,000-40,000, many of whom struggle to secure new employment without retraining or attitudinal shifts. Long-term unemployment of six months or more has also risen from 20 percent pre-pandemic to 30 percent this year, impacting sectors such as catering, where veteran chefs displaced by restaurant closures face difficulty transitioning to other culinary niches.

Addressing concerns that imported workers may be displacing local employees, Chan argued that wage growth in catering and retail sectors contradicts this notion, noting that falling salaries would be expected if direct competition were pushing locals out of jobs.

The report projects significant shortages of 48,000 to 53,000 skilled technical workers and 36,000 to 41,000 manual laborers, collectively constituting about 40 percent of the overall shortage. Rising educational attainment and an aging workforce—median ages of 50 for skilled technical workers and 54 for manual laborers—are key factors driving this gap. Additional shortages are anticipated among managers, supervisors, and professionals, particularly in technology and finance sectors, ranging between 33,000 and 38,000, as well as in service and sales positions, with deficits of 28,000 to 33,000.

In contrast, clerical support jobs may face a surplus of 25,000 to 30,000 roles due to increased automation and AI deployment. While office administrative positions make up roughly 20 to 30 percent of the workforce in trade and finance, Chan acknowledged that while these roles are subject to restructuring, the precise extent of job displacement caused by technology remains uncertain.