Some chief executive officers and top executives from travel, catering and retail sectors, property agency and a government official join a luncheon organized by Recruit and China Daily to exchange their views on how enterprises should steer employees through the financial storm. Photos by Edmond Tang

Even as Hong Kong's unemployment rate increases to 3.8 percent, professionals said the worst is yet to come. Local job market will witness the toughest challenges after the Chinese New Year.

At a luncheon organized by Recruit and China Daily, chief executive officers (CEOs) and top executives from travel, catering and retail sectors, property agency and a government official exchanged their views on how to combat the crisis.

Laggard effect

Secretary for Labour and Welfare Matthew Cheung said that current unemployment rate can't reflect the current crisis, adding local jobless rate will shoot up in May or June when new graduates will flood the job market. He also said that more retail outlets are expected to wind up their businesses after the Chinese New Year.

Local catering business bears the brunt of the financial tsunami. Tao Heung Group CEO Eric Leung lamented that the industry has been facing the massive challenges - sagging businesses and climbing operating costs.

"I believe the business environment will deteriorate in March or April when more single operators decide to terminate their businesses after scooping the quick profits during the Chinese New Year," he said.

Hong Thai Travel Services General Manager Susanna Lau said that the financial turmoil is taking a toll on the travel industry significantly, saying general public becomes more cautious on their leisure spending.

But she pledged that the company won't lay off its staff, saying "our employees are our valuable assets. With the dearth of talents in travel industry, we prefer to employ alternatives rather than shedding workforce to tide over the crisis."

Shih Wing-ching, chairman of Centaline Property Agency, held a pessimistic view over the economic outlook, saying that the financial tsunami symbolizes the collapse of capitalism.

"Days of the leverage-fueled economy are over," said Shih. "With the tightening credit environment, there's a tough time ahead for the US government steering its economy out of the woods."

Although China has become the global economic powerhouse, Shih said that the country can't avert the crisis. "The country's export is slowing down. Some of my mainland friends running trading businesses complained that they haven't received any order from the US since the middle of the year."

Aid SMEs

The Legislative Council earlier hammered out a relief package to pledge HK$100 billion as a special loan guarantee for small- and medium-sized enterprises (SMEs).

Citibank (Hong Kong) CEO and Country Business Manager Weber Lo said that the banking sector welcomes the move despite the time-consuming procedure for loan approval.

As lenders took a prudent view in bailing out SMEs, Lo applauded that the government took the lead in backing the banks' lending. The move can boost the local lenders' confidence and stimulate the financings to SMEs.

However, with the handling of more paper works, it takes from two to four weeks to get a loan approval, he said.

Lo urged that the government should streamline the procedures since many SMEs need urgent financings to keep themselves afloat.

Caroline Mak, chairwoman of the Hong Kong Retail Management Association, said many local SMEs are struggling for survival. "Many of them are on the verge of closure as a result of the credit squeeze of local lenders."

She urged the government to rescue the bleeding sector lest the fallout precipitates into a wave of bankruptcies and layoffs.

Employees' attitudes

Given about 20,000 fresh graduates from colleges, universities and educational institutions will join the labor market in the summer of 2009, Cheung said that job seekers and employees have to change their mindsets to adapt to the society's transformation.

"The financial tsunami is a wake-up call. Graduates should take the jobs as they receive any offer," he said.

Lau said that employees should change their mentalities. "Some employees made complaints to me why the companies cut their benefits during the difficult time."

"The company trimmed its costs to spare more payrolls. They (employees) should have a better understanding toward their employers' initiatives. Both sides should pull together to get over the difficulties."

Department store YATA Managing Director Daniel Chong pointed out that today teenagers can't tolerate hardships. "Many teenagers can't stand the difficult job natures of retail businesses."

Misleading reports

Although the economy is in bad shape, Lo said that the job market is not as bad as media has reported.

He admitted that Citibank did make redundancies, "but the proportion is very small, something like five out of hundred... It's performance-based instead of a layoff. That's very normal in the banking sector even in the good time."

July Kong, director of human resources at Deloitte, said that the accounting firm raised the pay for its employees in October, but it was not reported by the local media.

"They(media)'re just interested in negative news..."

Mak also noted that local newspapers overlook positive news like corporate distributing bonuses and just focus on layoff and closure. It doesn't reflect the real situation and undermines the public confidence.

Job mismatch

To tackle the unprecedented financial crisis, Cheung said that the government unveils a slew of comprehensive strategies to address the problem.

"The government will speed up to kick off the infrastructure projects to create more jobs... it will also start the recruitments for civil servants - 7,700 new posts available over the coming years."

Although the unemployment rate is picking up, Mak said that job mismatch is so serious that some industries find it difficult to seek for relevant talents. She urged the government to play the role of a middleman for job matching.

(HK Edition 12/19/2008 page3)