Hong Kong pay growth slows as Guangdong accelerates, survey finds

Hong Kong workers received smaller pay rises this year as Guangdong’s wage growth picked up, with the starting salaries of university graduates edging closer to those of non-degree holders, an annual survey has found.

Hong Kong Baptist University released the findings of its 2026 Guangdong-Hong Kong-Macau Greater Bay Area Pay and Benefits Survey on Thursday. It showed that companies in Hong Kong and Macau slowed pay rises this year.

Meanwhile, Hong Kong’s unemployment rate rose by 0.1 percentage point to 3.9 per cent between July and September, the highest since the period from November last year to January, the government revealed. The figure was 3.8 per cent in the previous rolling period, between June and August.

But Secretary for Labour and Welfare Chris Sun said the labour force and total employment had risen further amid “a continued influx of fresh graduates and school leavers into the labour market”.

According to the university’s survey, the average pay increase for employees in Hong Kong fell from 2.5 per cent last year to 2.3 per cent, while Macau’s wage growth slowed from 1.6 per cent to 1.1 per cent. In contrast, Guangdong’s average increase rose from 1.8 per cent in 2025 to 2 per cent this year.

Guangdong also expects a higher average pay rise next year, forecast at 3.8 per cent, while companies in Hong Kong and Macau forecast an average increase of 3.1 per cent.

“Salary increase forecasts for 2027 have rebounded in Hong Kong, Macau and cities across Guangdong province,” Ray Leung, president of the Hong Kong People Management Association, said.

“This reflects the fact that, although businesses continue to face challenges from the external economic environment and cost pressures, they remain confident about their future development and talent needs.”

The survey, conducted between July and September, covered 78 companies in Hong Kong, 38 in Macau and 105 in the nine cities of Guangdong province, representing more than 270,000 employees in total.

Participating companies submitted employee pay data from July 2025 to June 2026 through an online questionnaire and provided forecasts for next year’s pay trends.

The study was jointly conducted by Baptist University, South China University of Technology, the Hong Kong People Management Association and the Talent Development and Management Association of Guangdong.

It also found that the average starting salary for Hong Kong university bachelor’s graduates remained unchanged at HK$19,500 (US$2,484) this year, showing no upwards trend.

The average starting salaries of recent bachelor’s degree graduates in Hong Kong edged down to between HK$17,500 and HK$23,000.

The gap between the starting salaries of bachelor’s degree and sub-degree graduates narrowed by 17 per cent, or HK$500, from HK$3,000 last year to HK$2,500 this year.

Sub-degree graduates’ average starting salaries ranged from HK$15,500 to HK$20,500 this year.

In terms of bachelor’s degree graduates’ pay, engineering graduates were offered the highest average starting salaries, earning HK$23,000 on average, up from HK$21,500 last year.

Other sectors reported declines, including information technology, where bachelor’s degree graduates’ starting salaries fell from HK$20,500 to HK$19,500 this year, and finance and accounting, where they dropped by HK$1,000 to HK$19,000 this year.

Looking ahead, 41 per cent of surveyed Hong Kong firms expected an average pay rise of 3.1 per cent in 2027, while one anticipated a pay freeze. The remainder did not provide forecasts.

This year’s survey also included a new study on artificial intelligence (AI).

While 78 per cent of bay area companies have begun piloting generative AI tools, exploring process automation and applying AI across various business functions, only 15 per cent have yet to establish formal AI policies, according to the survey.

Cecilia Tam, director of the Centre for Human Resources Strategy and Development at HKBU’s School of Business, noted that about one-fifth of companies had seen a reduction in junior administrative and support roles.

But she said companies were not simply replacing employees with AI.

“A common trend is that companies increasingly value people who can effectively use AI,” Tam said, adding that future competitiveness would depend not merely on attracting AI specialists, but on empowering every professional to use AI effectively.