The latest jobsDB 2019 Job Seeker Salary Survey has found over 80 per cent of Hong Kong employees expressed financial concerns about retirement, with ‘increased medical expenses while aging’ (64 per cent), ‘insufficient government welfare for elderly’ (53 per cent) and ‘inability to afford housing expenses’ (39 per cent) being the top three concerns.
The survey canvassed the opinion of 3,192 job seekers from mid-March to mid-April this year, showing that employees aged 36 or above chose ‘cannot find a job for living’ as their third concern about retirement (40 per cent). Meanwhile, almost half of the respondents aged 50 or above (49 per cent) shared the same concern, 15 per cent of them felt that their financial situations are more challenging than two years ago, and 22 per cent ‘have taken up part-time/freelance jobs to increase income’, the highest among all age groups.
Absence of universal retirement protection, overloaded public healthcare due to ageing populations and surging living costs make local employees wonder if their current financial situations can guarantee post-retirement lives. Moreover, despite the implementation of the Mandatory Provident Fund (MPF) for years, a report by the Mandatory Provident Fund Schemes Authority reveals that the yearly return of the MPF System in 2018 was -9.3 per cent, the worst losses since 2012, which further discourages employees from relying on it after retirement. Besides, both public and private institutions have recently been promoting financial instruments for the public to create pensions, including annuities and reverse mortgages, which require a deposit from payees or applicants. These obstacles make people believe that they have to work after retirement age to ensure their income.
Middle-aged employees in Hong Kong also worry about their financial conditions despite being a long way from retirement. Respondents who felt stronger financial pressure compared with two years ago (23 per cent) spend more on ‘accommodation’ (20 per cent) and less on ‘saving/investment’ (11 per cent). This allocation of spending contrasts with those are more satisfied with their financial conditions, who would spend 13 per cent on ‘accommodation’ and 21 per cent on ‘saving/investment’, showing that high accommodation costs are causing significant financial pressures on employees.
According to the latest survey by international public affairs consultancy Demographia, Hong Kong was ranked as the world’s least affordable housing market for the ninth consecutive year. The average home prices were 20.9 times the gross annual median household income, an increase from 19.4 in 2017, meaning it would take an average of 20.9 years to save up without spending a single dollar to afford a home.
The vast majority of respondents (86 per cent) have taken actions to deal with surging living costs. Most of them (82 per cent) reduced expenses, especially spending on ‘clothing/accessories’ (54 per cent), ‘entertainment/leisure activities’ (51 per cent) and ‘having meals outside’ (45 per cent).
Of the respondents, 67 per cent would take the initiative to increase their income, of which 34 per cent would do so by changing their jobs. This is especially common among millennials and employees with 3 to 10 years of work experience; 43 per cent aged 26 to 30 and 39 per cent aged 31 to 35 would choose to change their jobs to boost income, while 40 per cent with 3 to 5 years and 42 per cent with 6 to 10 years of work experience would do so. Employees who changed jobs in the past 12 months are more confident of their financial situations compared with two years ago. Of those who changed jobs, 49 per cent feel more financially comfortable, while 43 per cent of those who did not change their jobs.
Hong Kong always tops ranks of places with the most expensive living costs in international studies. Job hopping is probably one of the most effective ways for employees to catch up with rising costs and improve their financial situations. The survey also found that job seekers who moved in-line with optimal job switch frequency (once every three years) got an average of a 17 per cent increase in annual pay since their first full-time job ten years ago.
Based on the above findings, jobsDB suggests employees who are worried about finding a job to take initiative, plan ahead, keep themselves updated with the job market, and continue to acquire new skillsets so as to get prepared for switching jobs or getting into a new industry. Nowadays employers will proactively look for talent through job portals, so job seekers should update their resumes and job status regularly to highlight their skills and experiences, as well as leveraging job portal’s AI-powered systems for personalised job matching to make job search more efficient and effective. On the other hand, employees should treat job seekers of different ages equally, especially with the current low unemployment rate. If they put age bias aside, they may find unexpectedly helpful candidates.