Hong Kong construction booming but talent at an all time low

Posted on: 2016-05-17

Could the skills gap be closed with vocational education and up-skilling?

China has undergone a rapid rise over the last 35 years; it’s now the world’s second largest economy and boasts the largest workforce. This growth is especially prevalent in the Construction, Real Estate and Property industries, and the Hong Kong market is one of the most booming in the world. The adoption of specialised construction techniques, such as reclamation and design-and-build methods, has made Hong Kong a regional leader – and it’s expected to continue to play a critical role in the Built Environment for a long time to come. Screen Shot 2016-05-17 at 10.33.40

According to a recent report by the Hong Kong Trade Development Council, the gross value of construction work by the main contractors in Hong Kong has been on the rise since 2009. In 2015, the gross value of construction work increased by 15% YoY to HK$55.2 billion (£4.9 billion). In addition, ten mega infrastructure projects – first announced in 2007 – are continuing to be rolled out, boosting Hong Kong’s construction market further.

However, Hong Kong is having difficulty fulfilling these projects due to a lack of skilled workers – despite gaining seven million graduates each year. While major infrastructure projects, residential market growth, and a large retail footprint have made it a magnet for Built Environment talent, there’s still not enough to keep up with the market demand. All employers in the sector are currently seeking property and construction professionals.

So why is there such a skills shortage in Hong Kong? Apart from the industry growing so rapidly, some have also attributed the shortage to an education system that has failed to prepare young people for working life – while others say it’s a symptom of employers shifting the training of employees onto academia, rather than investing in it themselves.

Whatever the reason, it’s suffering from a severe shortage of all Built Environment skills. If the market is to continue its current expansion, then an available, talented and engaged workforce is critical. So what can be done?

Is the path to talent through vocational education?

 The education of the younger generation in Built Environment disciplines is vital to ensure skilled talent continues to enter all areas of the industry. Vocational education, such as industry-specific courses and apprenticeships – rather than traditional route of studying a broad university degree straight after school – means potential talent can be trained in the skills they need to hit the ground running, gain cutting-edge industry knowledge, and add value to organisations from the start.

And it seems the Chinese Government agrees. In the proposals for China’s 13th Five-Year Plan (2016-2010) – released early this year – vocational education was a major highlight:

“Innovative teaching abilities to be raised to ensure some universities meet world standards. Modern vocational school system to be set up and universities encouraged to transform into vocational schools.”

“Cooperation encouraged between schools and enterprises to train skilled workers. Skilled workers’ salaries to be increased.”

Could these methods produce talented professionals who are equipped with the expertise employers need, and, of course, close the skills gap?

Let’s not overlook what we already have: progress and retain existing skills

Another area where Hong Kong could improve in is encouraging organisations to progress and retain their existing talent. Investing in the development and training of current staff is often low on the list of business priorities but it can directly affect commercial success. Continuously evaluating, refining and improving the workforce means more staff will have up-to-date and relevant skills, companies can increase their overall market and technical knowledge, and, ultimately, fulfil any business project.

Also, companies generally end up spending much less on up-skilling and retaining staff compared to the amount required to recruit highly skilled candidates. And educating unqualified staff while they continue to work means valuable time isn’t missed waiting for people to be trained. It also means they can start making a difference in their work straight away, as courses can often be tailored to match company projects.

It’s important for everyone in the industry – employers, educational establishments, governments and industry professionals – to be constantly learning, innovating and evolving in order to close the skills deficit and future-proof the Built Environment.

For more information on UCEM’s Built Environment activities in Hong Kong please read more about our regional office.