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LCQ9: Importation of construction workers

Following is a question by the Hon James Tien and a written reply by the Secretary for Development, Mr Paul Chan, in the Legislative Council today (April 16):

Question:

It has been reported that on March 26 this year, the Labour Advisory Board (LAB) endorsed the proposal of the Government to expedite the labour importation processes for public works projects (including railway projects).  Under the proposal, the authorities will set up a dedicated task force to help examine the applications for importing labour of 26 designated trades prior to their submission to LAB for vetting and approval.  It is expected that the average processing time will consequently be shortened from the current 7.5 months to six months.  Regarding importation of construction workers, will the Government inform this Council:

(1)  of the respective numbers of imported construction workers and registered local construction workers (with a breakdown by age group) in each of the past five years;

(2)  of the respective current shortfalls in manpower in the aforesaid 26 trades and their respective median wages (set out by trade in tables);

(3)  whether it has assessed the extent to which the manpower shortage of the construction industry will be alleviated by expediting the labour importation processes for public works projects by LAB; if it has, of the details; if not, the reasons for that;

(4)  whether it has assessed the impacts of the shortage of construction workers due to the failure to timely import labour on the progress and costs of public works projects (including railway projects), and on aspects such as people's livelihood, and the economy; if it has, of the details; if not, the reasons for that; and

(5)  whether it has considered making reference to the Special Labour Importation Scheme for the New Airport and Related Projects (SLIS) implemented by the authorities between 1990 and 1999 and introducing an SLIS for public housing and infrastructural projects, so as to ensure the completion of various related projects on schedule, with a view to addressing the housing needs of the grassroots as early as possible, and maintaining sustained economic and social development; if it has, of the details; if not, the reasons for that?

Reply:

President,

The Hong Kong Special Administrative Region (HKSAR) Government is committed to promoting economic growth, creating jobs, improving people's quality of life and enhancing the long-term competitiveness of Hong Kong through infrastructure developments.  In the coming few years, construction works of a number of large scale infrastructure projects including transport, medical services, water supply, etc. will commence.  With the total projected construction output of public and private works projects to be maintained at a high level in the coming few years, there will be a keen demand for construction workers in Hong Kong.  Further, the construction industry is facing problems of ageing and skills mismatch.

In the medium to long term, we will continue to strive to meet the manpower demand by training and re-training local workers and attracting more new entrants to join the construction industry.  Over the past few years, the Administration and the Construction Industry Council (CIC) have implemented various training initiatives and training courses, and CIC has substantially increased the number of training places.  However, taking into account the limitations of training, such as the time required to nurture semi-skilled graduate trainees to become skilled workers and the loss of productivity for in-service skilled workers in nurturing semi-skilled workers, we project that there will be labour shortage in the coming four years from end 2013 to 2017.  With due regard to the principle of not affecting the employment and reasonable income levels of local construction workers, we need to make full use of the "Supplementary Labour Scheme (SLS)" to import skilled workers in a timely manner.  This will not only help meet the manpower demand of the construction works but also make room for local in-service skilled workers to nurture semi-skilled workers for further enhancing their skills to achieve the productivity of skilled workers.

My reply to the five parts of the Honourable Tien's question is as follows:

(1)  The number of construction workers approved to be imported under the SLS from 2009 to 2013 is set out as below -

           Approved number of
Year      imported workers
----     ------------------
2009              7
2010              1
2011             14
2012            284
2013            566

According to construction workers' registration record of CIC, the breakdown of registered construction workers by age groups over the past five years is shown in Table.

(2) to (4)  To cope with the manpower challenges of the construction industry, we have implemented a series of measures including obtaining a total of $320 million from the Legislative Council in 2010 and 2012 to support CIC to strengthen its role in training local construction personnel and enhance promotion and publicity activities to attract more people to join the industry.  Amongst others, we collaborate with CIC to launch the "Enhanced Construction Manpower Training Scheme" with higher training allowance to train semi-skilled workers.  Having regard to the manpower forecast study being conducted by CIC, forecast construction output, number of in-service registered workers, retirement of workers and local workers going to work outside Hong Kong, etc. and taking account of the forecast number of semi-skilled workers to be trained and better utilisation of potential workforce of the industry (including the unemployed and underemployed workers as well as workers who have left the construction industry) and their limitations, we project that the industry will need nearly 10 000 to more than 10 000 additional skilled workers in the coming four years from end 2013 to 2017.

Regarding the labour shortage of individual trades, the manpower demand for each trade varies with the work progress, whereas the progress of individual projects may be affected by various factors, which may lead to delay of different magnitude.  In this connection, we have difficulty in making accurate projection on the short-term manpower shortage of individual trades.

We need to continue the investment in worthwhile infrastructure projects in a timely manner to meet social needs and maintain Hong Kong's competitiveness.  If we cannot import skilled workers timely to meet the manpower demand in the coming four years, it will not only lead to delay and deferral in the commencement of construction of worthwhile projects but will also pose the risk of creating a more acute construction peak several years later which may result in even higher project prices and further strain the manpower situation.  Realisation of the economic and social benefits of these projects may also be deferred.  Moreover, construction project comprises works of sequential phases. Works of the later phases may only commence when the works of the preceding phase have been completed.  Hence, labour shortage for individual trades will not only lead to delay in work progress but will also hamper the job opportunities of local workers in the subsequent phases of works.  

The current arrangement is to better prepare for the SLS applications related to public sector works (Note: The public sector works include the works of the Government, MTR Corporation and the Housing Authority.) with a view to saving the time for administrative work in order to facilitate the smooth processing of the SLS applications.  Under this arrangement, we will not bypass the Labour Advisory Board (LAB), not replace the existing SLS mechanism and not adopt a quota approach.  Further, contractors will be notified of their application results within a reasonable period of time to facilitate manpower planning.  

As for the trades in manpower shortage, being the coordinating body of the industry, CIC set up a Task Force on Short-term Labour Supply (the Task Force) (Note: The Task Force comprises representatives of the Hong Kong Construction Association, the Hong Kong Federation of Electrical & Mechanical Contractors Ltd., the Hong Kong Construction Industry Employees General Union, the Federation of Hong Kong Electrical and Mechanical Industries Trade Unions, Construction Site Workers General Union of the Hong Kong Confederation of Trade Unions, MTR Corporation Ltd, the Housing Authority and the Development Bureau.) in January 2014.  The Task Force was tasked to identify a list of trades with manpower shortage and their standard recruitment requirements (including close to market wages).  After thorough discussion, the Task Force has identified 26 trades with manpower shortage.  CIC will regularly review the list to reflect the latest market situation.  The information will be for reference of the contractors, the Labour Department and LAB.  However, the Task Force will not be involved in individual SLS applications.  Besides, CIC can make reference to the list in reviewing and adjusting its training programme as appropriate to better meet the market needs.

At its meeting on March 26, 2014, LAB accepted the above-mentioned arrangement and agreed to make reference to the list and their standard recruitment requirements in processing SLS applications.  Please refer to the Annex for the close to market wages of the list of trades.  Details are available at the following CIC webpage: www.hkcic.org/eng/info/ShortageTrades.aspx?langType=1033.

(5)  Having reviewed various options for coping with the short term labour shortage in the construction industry, we consider it most appropriate to make use of the existing SLS mechanism in processing the applications case by case.

Attachment:

Ends/Wednesday, April 16, 2014
Issued at HKT 15:04

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