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(Adds city’s unemployment rate in 14th paragraph.)
Feb. 10 (Bloomberg) -- Hong Kong will face a shortfall of 22,000 workers with higher education by 2018 as the city’s population ages, the government said in its first forecast for a shortage since it began the study in 1988.
The city, which has a total population of about 7.2 million, will need an additional 500 people with degrees in six years’ time, while it will have an 8,500 surplus of employable people with a “lower education,” the city’s Labour and Welfare Bureau said in a report.
The Hong Kong government has turned to China to try to attract talent to meet a manpower deficiency, as it faces increasing challenges to lure professionals elsewhere because of competition from cities including Singapore. Asia’s elderly population is poised to double within four decades, according to the United Nations.
“Aging population is one of the key population policy issues on which the government has been focusing its efforts,” the bureau said. “As the retirees leave the labor force, the growth in manpower supply will be hindered.”
About 17 percent of Hong Kong’s population will be at least 65 years old by 2018, compared with 13 percent last year, according to the Census and Statistics Department. The city has the lowest birth rate in a government list that included five countries, and the gap is projected to widen.
Hong Kong had granted residence to 40,933 mainland China professionals and skilled people by the end of 2010 under an admission plan started in 2003, according to the government website.
Hong Kong faces increasing challenges to lure professionals because of competition from cities such as Tokyo for quality of living. Singapore was 25th, Tokyo 46th and Hong Kong 70th in Mercer LLC’s quality of life list published in November.
Pollution, high home prices and difficulties in finding school places for expatriate children are cited as reasons foreign professionals choose not to live in Hong Kong.
The city’s schools have failed to keep up with record numbers of applications. In a survey of American Chamber of Commerce members in May last year, 63 percent said some executives are driven away by the lack of student places.
Home prices have surged about 66 percent since early 2009 on record low mortgage rates, a lack of new supply and an influx of buyers from other parts of China. The government has imposed measures to prevent the formation of an asset bubble since late 2010.
The city’s air pollution is linked to thousands of avoidable deaths, the University of Hong Kong said last year, with many due to respiratory and cardiovascular disease, according to Thach Thuan-quoc, an honorary assistant professor.
“Some international companies may opt for Singapore over Hong Kong because of pollution and education concerns, but Hong Kong still has an edge in its proximity to China,” Raymond So, dean of the business school at Hang Seng Management College in Hong Kong, said last month.
Demand for professionals in the financial services industry is expected to increase 2.5 percent to 253,100 by 2018, while the number of workers needed in the manufacturing sector may drop 3.1 percent, according to the government report.
Hong Kong’s unemployment rate slid to 3.3 percent for the three months ended Dec. 31, the lowest level in almost 13 years on strong local consumption demand and tourism.
Hong Kong’s fertility rate is expected to decline 5.7 percent to 983 births per 1,000 women in 2019 from 2009, the lowest in the government list that included Australia, Japan, the U.S., the United Kingdom and Sweden.
The number of Asians 60 or older will exceed 1.25 billion, or 24 percent of the population in 2050 from 10 percent in 2011, according to data compiled by the United Nations.
--With assistance from Stanley James in Hong Kong. Editors: Stan James, Hwee Ann Tan
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