Transcript Document

Talent for a Knowledge-Based
and Innovation-Oriented Economy:
Hong Kong’s Challenges and Opportunities
David M. Hart and Fangmeng Tian
School of Public Policy, George Mason University
Hong Kong Innovation Project Conference
10 January 2009
Presentation Outline
I.
II.
Empirical context and theoretical background
Human resource indicators:
•
•
•
•
III.
Undergraduate degrees
S&T undergraduate degrees
High-occupational status
R&D and IT workforce
Policy options
Part I. Empirical Context and
Theoretical Background
Empirical Context
Hong Kong’s long-term economic growth
Rapidly changing regional/global environment:
• Mainland China
• East Asia
• Global business restructuring
Intensifying international competition for talent
Hong Kong demographics and location
Theory: Human Capital and Growth
“Supply-push”
General human
capital
“Demand-pull”
Specialized
human capital
(S&T fields)
High-skill migration
Industrial clustering
Knowledge-based
economic
growth
Growth of
Innovation-oriented
industries
Part II. Human Resource Indicators
A.
B.
C.
D.
Undergraduate degrees
S&T undergraduate degrees
High-occupational status
R&D and IT workforce
Data Sources
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Hong Kong Census
General Household Survey
Hong Kong as a Knowledge-Based Economy
Hong Kong as an Information Society
R&D Statistics of Hong Kong
UGC and Immigration Department statistics
Personal interviews
International sources
Undergraduate Degrees, All - Supply
Undergraduate Degree Holders in HK Working Population
700000
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
600000
500000
400000
300000
200000
100000
0
1996
2001
2006
Degree holders in working population
Share in working population
Degree Holders in Resident Population in Global Cities
4500000
45%
4000000
3500000
40%
35%
3000000
2500000
30%
25%
2000000
1500000
20%
15%
1000000
500000
10%
5%
0
0%
NYC
Tokyo
BJ
London
SF
Degree holders in resident population
1996-2006:
• Total increase: 70%
• Annual growth rate: 5.5%
• Doubling time: 13 years
SH
Taipei
HK
SG
VC
Share in resident population
Lags behind other “global
cities” (NY, London, Tokyo)
Comparable to regional
centers (Singapore,
Shanghai)
Undergraduate Degrees, All – Estimated Flows, 2006
20,000 local
graduates
16,500 GEP
5,000 ASMTP
6,500
returnees
10,000 stay in
HK but do not
work.
Total flow
48,000
degree
holders
26,000 join
HK labor
force.
12,000 leave
HK
Undergraduate Degrees, All - Demand
Employment has grown steadily.
Unemployment rate has trended
down recently.
HKD
Median Income of HK Degree Holders
25000
20000
15000
Income gap between degree
attendees and those with less
education widened considerably.
10000
5000
0
1996
Earned income of highlyeducated peaked in 2001.
2001
Sub-degree/diploma
2006
Degree
S&T Undergraduate Degrees - Supply
S&E Degree Holders in HK's Working Population
300000
8%
7%
250000
6%
200000
5%
150000
4%
3%
100000
2%
50000
1%
0
1996-2006:
• Total increase: 62%
• Annual growth rate: 5%
• Doubling time: 14 years
0%
1996
S&T degree holders in
2001
working population
2006
Share in working population
S&E Degree Holders in Working Population in Global Cities
400000
35%
350000
30%
300000
25%
250000
20%
200000
15%
150000
10%
100000
5%
50000
0
0%
Hong Kong
Singapore
S&E Degree holders in working population
Vancouver
Share in working population
International comparisons
are only suggestive due to
limited data collection,
definitional differences,
and varying dates.
S&T Degrees: Flows and Demand
Estimated flow of S&T degree holders:
• Annual net inflow: 9300
• UGC graduates: 8600
• Returnees: 2500
• Foreign-born: 3000
• Departures or did not work in HK: 4800?
Labor Market:
• Employment growth of S&T degree holders lags all degree holders.
• Salaries peaked in 2000 and remained about 10% below peak in 2006,
lagging other fields.
• Interviews point to possible shortages in specific sub-disciplines.
High Occupational Status (HOS) – Supply
Definition: Managers and administrators, professionals, and associate professionals
High Occupational Status in HK's Working Population
1200000
34%
1000000
33%
32%
800000
31%
600000
30%
400000
29%
200000
28%
0
27%
1996
2001
HOS in working population
2006
Share in working population
HOS in Working Population in Global Cities
4500000
45%
4000000
40%
3500000
35%
3000000
30%
2500000
25%
2000000
20%
1500000
15%
1000000
10%
500000
5%
0
0%
Singapore
Hong Kong
Taipei
SF
HOS in working population
Shanghai
Beijing
Tokyo
Share in working population
New York
1996-2006:
•Total increase: 25%
•Annual growth rate: 2.2%
•Doubling time: 30 years
•43% hold undergraduate
degrees in 2006 vs. 33% in 1996
•80% of growth among associate
professionals
•Number of managers and
administrators shrank
•International comparisons are
slightly more favorable than for
education.
HOS: Flows and Demand
Growth in the HOS population
is not even over time.
Cumulative growth is almost
entirely among the Hong
Kong-born.
Only about 6% of holders of
HOS positions lived outside
HK in the five years prior to
2001 and 2006.
Salaries overall rose fairly
steadily, but managers and
administrators did much
better than professionals and
associate professionals.
Salary Indices for Managerial and
Professional Employees
130
125
120
115
110
105
100
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Nominal Salary
Real Salary
R&D Workforce: Supply
Note: no official estimates of the S&T working population comparable to U.S.
R&D researchers in HK's labor force
20000
6.0
18000
16000
5.0
14000
12000
4.0
10000
3.0
8000
6000
2.0
4000
2000
1.0
0
0.0
1998
1999
2000
R&D researchers
2001
2002
2003
2004
2005
Number of researchers per 1000 workers
R&D Personnel in Global Cities / Regions
160000
2%
140000
1%
120000
1%
100000
1%
80000
1%
60000
1%
40000
0%
20000
0%
0
0%
Hong Kong
Singapore
R&D personnel
Beijing
Taiwan
Share in working population
1998-2006:
•Total increase: 154%
•Annual growth rate: 12%
•Doubling time: 6 years.
Especially strong in the
business sector:
•10,000 new R&D jobs
•350%+ growth
But from a low base…HK
has relatively low R&D
share of workforce.
R&D Workforce: Flows and Demand
In-migration plays a small role:
• The vast majority of R&D positions are filled by HK-born
permanent residents.
• About 1/3 hold their highest degrees from non-local universities.
• About 10% reported living outside HK five years earlier.
• Local universities doubled the number of graduate degrees
awarded in S&T fields over the past decade.
The market for R&D talent is fairly tight:
•A significant number of establishments identified lack of qualified
personnel as an important barrier to innovation.
•But salaries seem to have declined between 2001 and 2006.
High-Skill IT Workforce: Supply
1996-2000: 70% growth
2000-2006: 8% decline
Many more HK residents
acquired advanced
IT/computer training
than hold high-skill IT
jobs.
We did not find
comparable international
data for this indicator.
Source: Hong Kong as a Knowledge-based Economy (2007)
High-Skill IT Workforce: Flows and Demand
Only about half hold undergraduate degrees.
In-migration plays a small role:
• Well under 5% are not permanent residents.
• About a third of those who hold a degree received
their highest degree abroad.
Incomes declined between 2001 and 2006.
HR Indicators: General Observations (1)
Hong Kong has been accumulating human capital, both general
and specialized to science and technology, at a relatively rapid
rate in the past decade.
The demand for this talent kept pace reasonably well overall,
although income data suggest some softness in recent years.
There is evidence of a talent shortage only in a few specific
categories, notably (in our review) for managerial, executive
and R&D positions and (anecdotally) for certain engineering
specialties (which our data are too coarse to confirm).
HR Indicators: General Observations (2)
HK’s talent pool still trails the leading “global cities” with which
it is often compared.
HK appears to be keeping up, broadly speaking, with its
competitors in East Asia, but these competitors are developing
quite rapidly themselves.
Part III. Policy Options
Policy Options: General Observations (1)
Preface: investing in higher education has value
beyond the economic context.
The SAR government has paid attention to HR and
should continue to do so.
Maintaining the momentum of the past decade is likely
to be challenging, and these challenges would be
heightened if the government seeks to accelerate the
pace.
Policy Options: General Observations (2)
HK will probably need to find ways to reach out more
assertively to the rest of the world for talent,
especially to mainland China.
HR supply policies should be embedded in broader
packages that also incorporate demand
considerations, especially for specialized fields.
Matching HR supply and demand may require stronger
central coordination within the SAR govt.
Policy Options: Higher Education (UGC)
Expand undergraduate programs in UGC-funded institutions:
• <1% annual growth over the past decade.
• An additional 4K degrees per year by 2020 would require
growth that is 3x as fast.
Enroll more mainland and foreign students in these programs:
• Current share is about 10%.
• This share may need to triple or quadruple.
• Mainland students may require financial support, which might
be linked to post-graduation work in HK.
Continue to allow disciplinary composition to be demand-driven.
Policy Options: Higher Education (Non-UGC)
Facilitate capacity expansion and regulatory framework for “top
up” programs for degree completion:
• “Phenomenal” growth in self-financed sub-degrees.
• Not necessarily perceived to be a terminal degree.
• Accommodates non-traditional students.
Policy Options: Immigration (ROW)
Develop a diaspora “policy”:
• 290K skilled HK expatriates in OECD countries
Maintain GEP:
• Demand-driven, employer-led
• Address related quality of life issues?
Promote HK to potential skilled immigrants through
Invest HK, rather than Immigration Dept.?
Policy Options: Immigration (mainland)
Continue to expand ASMTP incrementally:
• Roughly ¼ the size of GEP now
• Demand-driven
Implement and promote IANG and related programs:
• Prior experience abroad or HK education enhance odds of
successful integration
• Demand-driven
Continue to refine and promote QMAS:
• Link to broader economic strategy
• Delegate discretion to outside advisors
Conclusions
A sound basis has been laid for continued movement into the
knowledge-based and innovation-oriented economy:
• Excellent higher education system
• Nascent achievements in skilled immigration policy
Accelerating the pace of human capital formation may be a
crucial part of a broader economic development strategy:
• Address institutional and demographic constraints
• Bear demand factors in mind
Thank you!
Contact:
[email protected]
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