Promoting Work: A review of Active Labor Market Policy in Hong Kong

Hong Kong has been quoted as the most liberal economy and also a model of residual welfare. As commonly conceived, the social and economic system is characterized by a free market and low level of public intervention, with heavier emphasis on self-reliance through engaging in economic activities - work. Simultaneously, the social protection system was a social assistance scheme - Comprehensive Social Security Assistance (CSSA) - serving as a safety net for those who cannot support themselves through work or other means of living.

While work - signifying the virtue of self-reliance - has been the core of Chinese society as well theHong Kong society, stable and continuous work has been a concern early 1990s resulted from massive relocation of local capital, especially manufacturing industries to Mainland leading to displacement of labor force. Investment in employee retraining programmes was adopted in early 1990s as the earliest form of Active Labor Market Policy (ALMP). With deepening concern in the increasing reliance on social assistance after the Asian financial crisis, the workfare programme - Support for Self-Reliance Scheme - was adopted in 1999 to motivate those claimants back to work. Since 2000s, a greater variety of ALMP has been introduced, covering more target groups, aiming at sustaining or improving the persons' employability and pushing those social assistance claimants back to work. 

This paper provides a review of the development of ALMPs in Hong Kong since late 1990s. The scale was in line with the severity of consecutive economic crises and the political pressure resulted. While with greater emphasis (and hence cultural approval) on work, condemnation on those able-bodied social assistance claimants has been intensified. Nevertheless, review shows that the scale of social assistance scheme has not been trimmed down, and the expense on ALMP programme is still relatively small. This, on one hand, shows that passive labor market policy - social assistance - cannot be trimmed down easily given the worsening economic conditions with disproportionate impacts on those vulnerable labor groups; and on another hand, the limited scale of the ALMP.