The average wage rate for all major sectors fell 1.3% in nominal terms in December over a year earlier. This was the same as in September.

About 38% of companies recorded falls in average wage rates, mainly attributable to cuts in basic salaries and guaranteed allowances in early part of the year.

Forty-five per cent recorded an increase, mainly due to retrenchment of lower-paid clerical staff and operatives, leading to a rise in the proportion of relatively higher-paid workers over a year earlier.

After discounting the increase in consumer prices as measured by the Consumer Price Index (A), the overall average wage rate for all major sectors fell 1.7% in real terms in December.

Personal services

The nominal wage indices fell in almost all major sectors, ranging from 1.1% to 1.7%. The personal services sector was the only one with a rise in nominal wages and the increase was 1.8%, mainly attributable to the upward adjustment in salaries of employees in barber and beauty shops.

For the real wage indices, year-on-year falls were observed in almost all major sectors, ranging from 1.6% to 2.2%. The only rise in real wages was also observed in the personal services sector and the increase was 1.3%.

As for payroll, the index of payroll per person engaged for all major sectors fell 0.6% in nominal terms in the fourth quarter of 2004 over a year earlier. This was similar to the 0.5% fall in the third quarter.

The year-on-year fall was largely attributable to the reduction in payroll by some government-subvented organisations, to keep step with the civil service pay cut effective from January last year.

Q4 payroll falls

After netting out the effect of the increase in consumer prices as measured by the Composite Consumer Price Index, the average payroll per person engaged fell 0.9% in real terms in the fourth quarter, over a year earlier.

As for payroll per person engaged, year-on-year decreases in nominal terms were registered in the transport, storage and communications sector, the financing, insurance, real estate and business services sector and the community, social and personal services sector, ranging from 1.1% to 2.5%.