Hong Kong’s Demographic Problem
If demographics is destiny then women will dominate Hong Kong in the coming years. That’s what Richard Harris, Chief Executive of Port Shelter Investment Management, means when he highlights Hong Kong’s surprising demographic imbalance, where the share of women in the 25-59 age group exceeds the share of men.
Specifically, Harris refers to the 35 to 60 years age group where there are five per cent more women than men and where Hong Kong's population pyramid shows a clear imbalance between the sexes.
Hong Kong's Population Pyramid, % of Population by Age Group
Source: United Nations (2016)
But should this matter? Well, for one, the imbalance means Hong Kong has one of the world’s lowest birth rates in the world, which means fewer new births and a larger population of older people compared to younger generations.
This imbalance will weigh in Hong Kong’s growth prospects down the line by tightening the supply of labour and putting a huge burden on government finances to provide social services and pensions for the growing elderly population.
So what can be done? Governments all over the world are facing this problem, but the example of Japan, with increased retirement ages and the promotion of part-time work, and Sweden, with targeted measures to boost female labor force participation, may offer a solution.
With elections coming soon in Hong Kong, the extent to which candidates promote policies to deal with demographic challenges will show how seriously the government is taking this problem.