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On The Record

Nurturing human capital key to growth

(June 25, 2014)

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Secretary for Labour & Welfare Matthew Cheung

If the success of future organisations is about a good combination of people, business strategies and technology, then people leaders who can attract, lead, groom, motivate, inspire and retain the best of talents must be the key to corporate success.
 
If you ask any seasoned property agent what underpins the value of a property, the answer is a resounding "location, location, location". Equally, if you ask a successful business leader what drives a thriving enterprise, the response is a clear "people, people, people".
 
In a similar vein but at a more macro level, the sustainability, vibrancy and long-term competitiveness of an economy also hinges largely on human capital and the ways in which government policies and the corresponding social environment empower and enable people to realise their potential to the full.
 
This is particularly so as the global economic restructuring has led to an increasingly knowledge-based and innovation-driven economic order where the roles of knowledge workers and skilled talent become all the more essential.
 
Nurturing youths
Partly in response to a competitive global economy and mostly out of our firm belief in investing in Hong Kong's human capital - which is virtually our only resource - the Hong Kong Special Administrative Region Government is fully committed to nurturing and educating our young people and the continuous upgrading of our workforce.
 
Expenditure on education alone now accounts for a significant 21.8% ($67.1 billion) of the Government's annual recurrent expenditure - the largest share among all policy areas. This underlines the importance that we attach to education, which consists of academic studies, vocational education and training, skills upgrading and life-long learning.
 
We also believe that education is fundamental to helping our young people realise their potential and promoting social mobility.
 
To enhance the employability and overall competitiveness of the local workforce, the Government injected $15 billion into the Employees Retraining Fund in January this year to finance the long-term operation of the Employees Retraining Board.
 
Life-long learning promoted
The 2014 Policy Address also announced the establishment of a $1 billion fund to provide long-term support for the development of the Qualifications Framework which seeks to promote life-long learning and skills upgrading.
 
Increasingly, the success of future organisations will depend on whether people leaders are capable of building the best of teams. This does not only mean recruiting the right people, but also continuous training and grooming of staff members so that their full potential can be realised and a sense of belonging fostered. Finding ways to win the talent war is the golden rule for future organisations and societies alike.
 
As connectivity across boundaries and borders has improved tremendously, international talent becomes no less mobile than financial capital. Knowledge workers nowadays opt for the market, industry and organisation best suited to their preferences.
 
Financial gain is only one of their considerations. A better work-life balance, an employee-friendly, family-friendly corporate culture, a socially responsible and/or environmentally conscious organisation are factors which figure prominently on the radar screens of top-notch employees.
 
People-oriented approach
Organisations which adopt a people-oriented approach of human resource management and corporate culture will be the ones to win the game and attract the best and brightest of employees.
 
There is another important reason why the best of talents will be drawn to more people-oriented leaders and organisations. The demographic challenge posed by an ageing population simply calls for a more flexible and tailor-made approach to team building and people management.
 
According to the World Health Organisation, elderly people are the fastest growing age group worldwide. By 2050, 2 billion people - or nearly a quarter of mankind - will be aged 60 or above. Hong Kong is no exception and our population is rapidly ageing.
 
At present, Hong Kong's elderly population stands at slightly above 1 million, meaning that one out of seven Hong Kong people is aged 65 or above. This ratio will rise to a staggering one in three (or 2.56 million people) by 2041.
 
Labour force to decline
With an ageing population, our labour force participation rate will fall from 58.8% in 2012 to 49.5% in 2041. To add to the challenge, our labour force is expected to peak at 3.71 million in 2018 and then decline to 3.51 million by 2035 before resuming modest growth.
 
For Hong Kong to maintain its economic vibrancy and prosperity, the Government is adopting a multi-pronged and long-term approach to improve people's quality of living, encourage family formation, attract foreign investors and talent, cope with the future demand arising from housing, employment, and other social and economic development needs.
 
Policy measures to enhance child care and after-school support services and retraining courses targeting the needs of women will need to be strengthened to offer more female homemakers the flexibility of returning to work.
 
To allow fathers of newborns more time to attend to family needs arising from childbirth, we have proposed a statutory three-day paid paternity leave and the relevant bill is being scrutinised by the Legislative Council.
 
Extending working life
In the face of the demographic challenges of an ageing population and shrinking labour force, the Government, as the largest employer in Hong Kong, is taking the lead and examining possible options on extending the working life of civil servants and a consultation exercise to this end is in full swing. Hopefully, this will have a demonstration effect and encourage the private sector to follow suit.
 
We are also working to better assist new arrivals, persons with disabilities and ethnic minorities to integrate into society through more tailor-made education and training and enhanced employment support services.
 
These are but a few of the examples of what the Hong Kong SAR Government has been doing to build an inclusive society as well as a diversified and multi-talented workforce.
 
Creative solutions
There is, of course, further room for improvement. In the years ahead, the Government will step up its efforts on all fronts to enhance the competitiveness, versatility and resilience of our workforce in order to secure Hong Kong's position as Asia's world city. In achieving this goal, we need the support and collaboration of the corporate sector.
 
As I see it, a typically successful corporation in the next decade and beyond may well have part-time or volunteer silver-hair mentors coaching the creative and dynamic Generation Y, mothers happily working flexible hours from home, people with disabilities unleashing their full potential with the aid of technology, and a multicultural team of talents bringing together the best of different worlds to business development.
 
At the helm of this win-win team will be a leader who truly understands and appreciates people's diversity, who is ever ready to embrace changes pragmatically, and who makes the best of humanity.
 
Secretary for Labour & Welfare Matthew Cheung gave this address at the Greater China Talent Management Summit 2014 organised by A-Performers.com.
 

Secretary for Labour & Welfare Matthew Cheung


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