1 HK’s economy, labour market and income disparity K C Kwok Government Economist 2 March 2007

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3 Some unanswered questions Is HK too expensive and uncompetitive? Is HK marginalized? Has HK’s economy structurally transformed itself? How serious is our structural unemployment, skill mismatch problem and what’s the future for our lower-end workers? How serious is our income disparity problem? What are the reasons? Will a minimum wage policy address the issue?

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Q2 : Q2 : Q2 : Nov- 07 Jan

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7 Financial, and trading and logistics services lead economic growth in recent years Q1-Q3 (%) Services Wholesale and retail Import and export trades Restaurants and hotels Transport and storage Communications Financing and insurance Real estate and business services Community, social and personal services

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12 低收入家庭數目及所佔百分率 # Number and share of low-income households # 註： (#) 界定為每月住戶收入低於 4,000 元的住戶。 ( ) 佔所有家庭住戶的百分率。 Note :(#)Defined as households with monthly household income of less than $4,000. ( )Share in all domestic households.

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17 Some unanswered questions Is HK too expensive and uncompetitive? Is HK marginalized? Does HK have a future? How serious is our structural unemployment? Will our lower-end workers be able to find work? How serious is HK’s income disparity problem? What are the reasons? Will a minimum wage policy address the issue?

18 Thank You