You're listening to Asia Centric from Bloomberg Intelligence, the podcast that pulls back the curtain non global business so you can invest better across the Pacific realm. I'm Tom mccorbett in Hong Kong.
And I'm John Lee. Hong Kong's so called brain drain is turning back into a brain gain as thousands of knowledge workers return to the city after fleeing COVID.
But who's coming back and from where could have a big impact on the city's economy, its culture, and its future.
Hong Kong's changing workforce is driven largely by twenty and thirty somethings flocking over the border from mainland China, and the reasons why they choose Hong Kong might surprise you.
What's driving the change and how might Hong Kong's job market look in twenty thirty and beyond. For this, let's bring in three experts. Mark Tibbett's managing director at Page Group.
In Hong Kong, Francis Senior analyst with Bloomberg Intelligence.
And Peter Lau, Associate analyst with Bloomberg Intelligence. Gentlemen, welcome, thank you, thank you.
Here Mark, what strikes you most about the job market's most notable changes.
I think there was a pretty seismic movement of people through the last few years. A lot of people left Hong Kong for various reasons, and as you guys just rightly pointed out, there's a flow of talent coming back
into the city and the demographic has certainly changed. I think the most notable shift for me, certainly as an expatche in Hong Kong, was a large volume of pretty seasoned, pretty senior overseas workers, business leaders, experts, et cetera moved out during the COVID period, and many of those moved out permanently.
And so that's at the stage for some big changes or at least a reset, if you will, for Hong Kong's job market. Was it just the obvious factors, was it COVID or were there other contributing factors.
I think the overall sort of economic political environment faced some changes through that same period, So I certainly think that there was a proportion of movement driven by that, certainly amongst the more local community. But I do think the expatriot community were really pushed out by COVID policies, not a huge amount more maybe some economic draw but largely COVID policies from an international standpoint and mark some of.
These workers are coming back to Hong Kong. Are they the expats or are they more sort of like Mainlanders coming to Hong Kong for the first time.
Obviously, there's definitely an influx of people from mainland China. The top talent visa schemes have appealed to people in mainland China in large numbers, and we're certainly seeing that from the other side of the border professionals that we see in China who are applying for the various schemes. So there absolutely is that, but there is also a flow back of talent from other markets within the Asia Pacific region, and also we're starting to see more now from further Afield Mark Tibberts.
In every great human migration, there is a component of running from something and then running to something. The writer Paul Through likes to say that travel is equal parts flight and pursuit. How do you see that dynamic as it applies to what's happening with mainland China and Hong Kong right now.
I think primarily they're running to Hong Kong for the advanced economy, the opportunities the education, maybe the healthcare system, access to international markets. I think largely following the carrot, so to speak.
Mark, There's been a lot of discussion of how Hong Kong is becoming much more integrated with China. Some have caught it the mainlandization of Hong Kong. When you recruit people for Hong Kong, is Mandarin as a language becoming much more important.
As a language is certainly more important in Hong Kong now than it ever was. I think that's actually been a process that was happening long before COVID. Certainly within the education system, we saw Mandarin becoming a much more dominant language. Obviously, it stands to reason that if more people are coming into Hong Kong from mainland China, then Mandarin is going to be spoken and heard a lot more. I think we'd all agree that you do at the moment in Hong Kong, for sure.
Francis Chan, senior analyst with Bloomberg Intelligence. You recently published a piece of research that was quite widely read on the Bloomberg terminal about this very subject. Talk a little bit about what your key findings were and the conclusions that you drew from.
That well, I think the first findings from our research is minenntization. As we discussed earlier, and more and more Mainlan talents are coming to Hong Kong for different reasons, hopefully for poor factors of the city, and that's very evident in the governments saratistics the visa information. Ninety four ninety five percent of the latest top Past Talent program released in December twenty twenty two applied by the mainland talents and twenty two thousand of them have been approved
in terms of applications. And if we look for other channels of visa application to Hong Kong, they are also predominantly occupied by talents from mainland China, and about only eight thousand of other talents have been getting visas from Hong Kong. But that will really spread across different Western countries or sofeast Asian countries. I would say seventy to eighty percent of the visa application we'll be coming from the North.
And Francis Chan, let's talk a little bit about the demographics of those people from the north, from mainland China coming into Hong Kong. Who are they, what's the age range, their background, who is it in mainland China broadly speaking that has found attraction to Hong Kong.
Well, they could be a wing from the age of twenty to forty, mostly so.
Mostly younger adults, early career professionals.
Or or mid age professionals. And if you take a look of the professions of these applicants coming to Hong Kong, you find that finance is one of the biggest industry attracting talents from the North, followed by maybe academic education industry. They may be coming to Hong Kong as professors or do R and D in Hong Kong working in different educational institutions. And two other segments which is not as prominent, but they are also significant. It will be commerce and
trade and information technology. Of course, if you talk about the biggest pool of talents, it will be for finance and academics.
I've noticed Mark Tibbetts from Page Group sitting here quietly as you were talking. Francis nodding his head, Marco head and way in, Yeah.
I think absolutely right. The largest group of migrants we're seeing is that ex executive workforce that maybe the junior aspirational executive people with young families and big financial commitments, and again I do think that speaks to the economic pull of the city. I largely agree with the intelligence that France has just mentioned.
Mark and Francis. You know, Hong Kong invariably always gets compared to Singapore if both cities vie for being Asia's financial capital. What's happening with this race like Mark? From your point of view, is Singapore gaining the upper hand or you think it's still too early?
Well, I just personally think that Hong Kong and Singapore are two different places and have two different roles in the sort of economic food chain of the region. I just don't think that Singapore can supplant Hong Kong in its location, in its strategic importance for Greater China, and Hong Kong needs to really focus on that as its sort of primary role, primary objective as a conduit for money for goods, trade for people, talent, etc. Into China
and out of China. And if we focus on our strengths in Hong Kong, then I personally think Hong Kong stands alone for all of its sort of assets and attributes in that regard. I think Singapore's equally in a really strategic location for a lot more economies, and largely speaking, I think that's going to drive Singapore's longer term success.
In Francis Chan, some cynics have written off Hong Kong already, but are they too quick to have written its epitheph sort of speak dog tailing off of Marx comments.
I think for Hong Kong's future or Hong Kore's prospects, it relies most heavily on China's prospects from this point onwards, both as a financial center or a business hob in the Asia specific area. If you talk about its status as the financial hop solely focusing on copy financing functions, Hong Kong as of now is the far ahead of Singapore, not because we are doing better, but we are the offshore financial hop of mainland China or the PLC Frans's like.
Sitting in Hong Kong, you do get this warp sense that you know, finance is the center of the universe, but there's actually other industries that are actually more important than finance. Technology. For a start, when I got to Singapore, I noticed that a lot of the technology companies I'm talking Apple, Google, Alphabet are located in Singapore. Is it arguable that maybe technology and you know, other M and cis find Singapore more attractive, Well, I.
Think your spot on. In fact, Singapore has a more diversified economy in terms of GDP contribution. Manufacturing including technology in fact, is the leading GDB contributor in twenty twenty two, followed by wholesale trade including commodities trading than finance and insurance in Singapore. That's government statistics talk about. Hong Kong, Finance and insurance is the top GDB contributor with twenty tuber self GDP contribution yea, followed by public sectors also
twenty one percent, i e. Government spending. Then you have maybe a property or important export as a support to the manufacturing centers in Southern China market.
You want to weigh in on that.
That's pretty consistent with my own personal view. And actually if you look at our business at Page Group, a similar proportion actually more comes from financial services in the region of thirty percent banking and insurance. It's just such a dominant space for us here. And I think again it's a strength that Hong Kong has that won't easily just drift off over. Of course, in a couple of years, yep.
Mark during your career in this part of the world in Asia, you spent last of time in mainland China. You've watched Shenzen grow from a small town into a major tech hub. Do you see that tech component making its way any more into Hong Kong or do you think sheng Jen is going to remain the epicenter of China tech.
Yeah, it's a really interesting point. I was actually there for a large chunk of that change, having really started moving our Southern China business into Shanzhen in two thousand and nine and operating there right up until COVID kicked off. I saw a lot of those changes and the evolution
of that technology industry and in the Shenjan economy. And I certainly think that the policy and if you look at the sort of the central government policy with regards to the Gredabay era in Hong Kong's role within that, it does seem to suggest that Hong Kong's got a
bigger role to play. But you know, Shanzen is vast and Hong Kong's got limitations in terms of land and workforce as it is, so to get businesses of the scale that you've got in Shenzen, like the Huawei and ztees, the Djis and ten cents and so on, who have so many thousands of people working for them. I don't think it's a competition. I think it's a collaboration that's probably going to see Hong Kong's role grow.
Francis Chan, you just heard Mark Tibbett mention the Greater Bay Area. You have also written about the Greater Bay Area a considerable length. Talk a little bit about what lies ahead in China's vision for the Greater Bay Area Hong Kong, Juhai, Macau, Guangzhou, and what that's going to look like five or ten years from now, any thoughts.
First of all, Beijing is taking a Greater Bay Area as the locomotive for its economy, and this agenda has been set for about ten years. And this area you will expect a population of eighty six million with eleven cities as being had by the four major cities, the two offshore cities Hong Kong, Macau, together with Quanto Province capital,
Kuangshu and the Special Administrative Region of Sinten. So this could be a powerhouse comparing to the Tokyo Bay Area, San Francisco's Bay Area, and finally in the New York'speto Poland Area. And we're expecting this to contribute to more than one
tenth of China's GDP. At the same time, it contains a lot of fast growing industries including technology as you said earlier, commerce and finance in Hong Kong, entertainment in Macau, conferencing in Hong Kong Macau, and with some backup manufacturing facilities in other smaller with the Bay area cities. So we are very autimistic on the future of this area.
And you mentioned eighty six million people, that's a quarter of the US population in this quarter of Guangdong Province or what borders Guangdong Province. If you're talking about Hong Kong in terms of GDP or per capital GDP, is it not the wealthiest province in China already?
Well, if you talk about the mainland Chinese cities, we still have Faijing, Shanghai. Talk about the provincial level, Arejiang and Jiangsu. Those are all very rich regional localities with very high income capital. But obviously Kwangdong is among those high income provinces. Or administrative regions. Hong Kong Macau themselves are considered as offshore special administrative regions, and obviously they have a higher income than China's average as a whole.
So if you put Hong Kong Macau together with the rest of the mainland cities in the Great Bay Area, yes, we will see it as the highest income group within the mainland China.
And francis which companies benefit from the growth of the Greater Bay Area.
Well, first of all, we want to go for the robust finance sectors, and we identify two groups of financial firms to gain most from the flows or the communicative wealth in the region. Foreign banks with great presence in the region, including hspecs, then the CHILDED and some of the Hong Kong domicile banks like Bank of East Asia, those could be gained a lot from those cross border flows. Of course, we have the biggest banks in the country ICBC,
Bank of China and China Construction Bank. They are presence both in the mainland cities in the Greater Bay Area and also in Hong Kong Macau and they will also gain a lot from these flows. As Hongkong Macau get more integrated into the Greater Bay Area.
Francis Chan Mark tibbets what do you see as far as the breakdown of nationalities where the expands come from. Do you see mainland China being the primary source of expans to Hong Kong or do you see any of the non China nations of generating an inflow in the future.
I think that inflow from mainland China will absolutely be the dominant inflow of talent in the next couple of years and beyond that, primarily because Mandarin as a language is going to be so important in the business ecosystem
of Hong Kong. I definitely think that Hong Kong will have plenty of international elements to its market, but the talent coming in from let's say Europe or the US or South America, I think these will be at the more senior end, perhaps with the exception of the education need. I think somebody spoke earlier about academic I've certainly heard recently that there has been a lot of influx of teachers from further afield.
Do you see Mandarin as being the primary quote language of business in China and Hong Kong much as English as the language of business and much of the rest of the world.
So increasingly so. I think anybody that is in Hong Kong in a customer facing role is largely required to be able to speak Mandarin and Cantonese. Absolutely. I think the exceptions lie more perhaps where it's a leadership role or more strategical, or maybe in more international markets where trade with China is concerned, that Mandarin's absolutely a prerequisite.
And mark outside of the language requirement. What are the skills do employees want these days? Has anything changed over the last few years.
Technology has become so intertwined with every aspect of business, and every organization these days in some way is also a technology company aside from the core of what they do. So I think technical ability the ability to use various new technologies, whether that be even as simple as social media, from a relationship management standpoint, right through to actually being
able to write code and so on. I think technological language and userability as well as spoken language is probably the next biggest thing.
Mark During your early days in Hong Kong and mainland China, could you have imagined the events of the past few years that have shaped the way the job market is today. Was it foreseeable. How did that strike you.
I've been in and around Hong Kong pretty much all my life, I think pre nineteen ninety seven, it was kind of hard to know much really, certainly as a young student as I was then, about what the future
might look like. But having been back here for fifteen years and working on both sides of the border, a good decade spent helping to build our business in mainland China, I would say yes, economically speaking, commercially speaking, I think the direction of travel has been more local than global, and more China centric than international in terms of the way I seen in Hong Kong developing and needing to be part of the bigger China strategy.
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Peter Lao, Associate analyst with Bloomberg Intelligence. You were born in mainland China, you grew up in shin Jen, You came to Hong Kong during your high school years, you spent college here. You gave up your hooku, your mainland residency to come to Hong Kong as a permanent resident. Those are big decisions for somebody, especially early in life. Talk about how that came about.
Well, I think it's not necessarily my decision. It's probably my parents' decision. Fair enough, there's a rationale behind. I think they definitely look at Hong Kong's access to the international education or even markets. Right. For example, if you're your kid in China, you're going to go through a lot of exams gau Kau and you're probably only going to land one of the top schools in China. But whereas you should do go through the Hong Kong education system.
You can actually choose China, you can choose local universities in Hong Kong, you can go to UK, Australia US.
So it opened up options for really, that's.
One I'm saying. So I think that's also a great pitch to a lot of the talents coming to Hong Kong because they can see that, oh I can plan for my kids, I can also plan for my job and stuff like that. So I think that's what makes Hong Kong an interesting place to them.
Are so many twenty somethings, thirty somethings, even forty somethings. Are they running front something or are they running to something? When they make that decision?
Well, I think these Mainian talents they're runn into Hong Kong. I believe that first of all, they thought about their etche across a lot of the markets London, New York, Hong Kong and Singapore. Hong Kong and singapare only places that these Melian talents can actually leverage their language skills right right, fair enough Mandarin? Right, you got to know the language in order to do due diligence or you know,
do acrid research whatever in Hong Kong. And Hong Kong has that soil to unleash their potentials because we have so many businesses with China, and I think that's where they think, right, they see, oh, this is a place that I can actually build up a career. I can leverage my skills, and the tex is very favorable and the work environment here is also great compared to China. We know about this kind of an evolution thing in China and in Chinese cons right.
And Peter, do you see a lot of people in your situation staying in Hong Kong or do they use Hong Kong as a stepping stone to maybe go to New York, London, Singapore.
That's a very good question.
It depends.
I think for finance, for banking, Hong Kong essentially gives them a great platform. I don't think a lot of them will love to, you know, jump around, because here you can get a lot of business done, right you go,
China can get up deals done. But for technology, I would say that's a different situation because as we talked about, Hong Kong doesn't have that many tech companies headquartered here, and I would say the evolution of technology here is a bit slow compared to other markets or other countries. So I think still for tech talent, they're gonna hesitate and they probably gonna think about where they go, and.
Mostly Silicon Valley or sea or or maybe even bacticians in.
Vacticians in exactly yeah, because those areas have the group at the circle, have the soil I would say, so, you know, meeting greets with people and to develop products together.
Mark, you're a senior executive at the Page group, you must get this question all the time. When university grad speed to you, they must say, like, what should I do to get ahead? What advice to give them?
I think anybody looking for a job, the first piece of advice that I would give is to network without shame. Okay, being an ex pat when you move somewhere new that the key is to accept every invitation and go meet as many people as possible, and then you'll find your channel, you find your lane. And I think this is a big risk posting covid is that people are a little bit averse to meeting people.
They're want Zoom meetings.
Yeah, and you know that they want to be able to sort of swite right to do everything in their life. It's a it's a convenience thing, right, But looking for a job as a human thing. And you know you can apply online, but in reality you're going to get a job by meeting people and impressing.
Okay, yeah, so be a hardcore networker.
Absolutely in person.
Though Zoom has not up ended the entire career management process, how's it.
I don't think so. I think though, that it's proving more complicated than I thought it would to unwind some of these habits. But I think zoom AD's convenience, if anything, it's definitely good for recruitment. It allows people to look for jobs a little bit more aggressively. It allows them to have initial interviews without disrupting their current existing work life. But most people prefer to make big decisions like that having looked someone in the eyes and established trust and rapport.
Our guests, I've been Mark Tibbitt's managing director with Page Group in Hong Kong. Francis Chan and Peter Lau, both with Bloomberg Intelligence, are fascinating exchange about jobs, the future, and Hong Kong's evolving niche. Gentlemen, it's been a pleasure and your insights have given all of us a lot to think about.
Thank you, Thank you, Thanks having.
I'm Tom Corbett in Hong Kong.
And I'm John Lee. This podcast was edited by Clara Chen and you've been listening to the Asia Centric podcast