Community & Education Hong Kong

Nine percent of Hong Kong’s population live in working poor families

About nine percent of Hong Kong’s population live in working poor families, according to a report by Oxfam Hong Kong.

The NGO, which focuses on poverty relief, said the number of working poor households in the city reached 189,500 last year, representing a 10.6 percent increase compared with five years ago.

These families are feeding 647,500 people, about nine percent of Hong Kong’s population.

subdivided flats

Photo: Ko Chun-ming.

In the report, working poor families were defined as households with at least one employed family member, living on less than half the median income of all households of the same size.

On average, each employed member of the working poor families had to support two non-working members, statistics from 2014 showed.

To tackle the worsening working poor issue, Oxfam called on the government to review the minimum wage and scrap the Mandatory Provident Fund (MPF) offsetting mechanism.

“The situation is getting worse because firstly, although the minimum wage has been in place for five years, it has not caught up with inflation,” Wong Shek-hung, programme manager at Oxfam, told HKFP.

subdivided flats

Photo: Ko Chun-ming.

According to the biannual review mechanism, the city’s minimum wage has risen 16.1 percent from HK$28 an hour in 2011 to HK$32.5 in May this year. However, the accumulated inflation in the same period has risen by 20.5 percent, Wong said.

“Workers cannot afford a basic standard of living in Hong Kong even though there is minimum wage,” Wong commented.

Last year, the NGO urged the administration to raise the minimum wage to HK$35 an hour and review the number annually.

Oxfam also called for the abolition of the MPF offsetting mechanism, which allows employers to offset their severance pay or long service payment to employees with MPF contributions.

“The MPF offsetting mechanism really negatively impacts employees’ retirement protection,” Wong said.

The report also highlighted the SAR’s extreme wealth gap. Hong Kong’s richest one percent owns 52.6 percent of the city’s total wealth, whereas the wealthiest 10 percent take up 77.5 percent of the total wealth, which is the highest among developed regions globally, the report said, citing Credit Suisse.

The city’s current poverty thresholds are HK$3,500 monthly income for singles, HK$8,300 for two-person families, HK$12,500 for three-person families, HK$15,400 for four-person families, HK$16,000 for five-person families and HK$17,100 for families of six or more.

Another study conducted by the the Commission on Poverty found that more than 40,000 Hong Kong seniors fell below the government’s poverty line last year.

Nine percent of Hong Kong's population live in working poor families