Expats eschewing life in Hong Kong

A toxic cocktail of economic recession, civil unrest, the Covid-19 pandemic and international condemnation of new security laws has resulted in an unprecedented decline the number of foreigners going to work in Hong Kong this year.

David Sapsted

27 October 2020

Latest data from the former British colony's Immigration Department showed that in the first nine months of 2020, 11,474 work visas were issued - down from 31,293 over the same period last year.Led by the US, nations such as Australia, the UK, Germany, New Zealand and Canada have all issued advisories against travel to Hong Kong since Peking imposed draconian national security laws in the summer.And while Hong Kong’s borders remain closed to non-residents as part of a Covid-19 lockdown, expats intending to work in the city are still eligible to travel once their visas have been approved, although they must complete a 14-day quarantine on arrival.Added to that, Hong Kong has now entered recession in the wake of months of anti-government protests last year and the effects of the pandemic this year. Unemployment is at its highest in almost 16 years with companies such as Cathay Pacific slashing workforces. Tara Joseph, president of the American Chamber of Commerce in Hong Kong, told the South China Morning Post (SCMP) that the US travel alert against travel to Hong Kong was only one of the factors weighing on the roughly 85,000 Americans in the city.“Overall, our members are more concerned about whether there will be further job losses as we get towards the end of the year,” she said. “People are worried about the relevance of Hong Kong, and the role of Hong Kong going forward.”Only 1,077 visas have gone to American citizens so far this year, about a third of the 3,038 issued over the same period in 2019.Piya Narang, managing director of international moving company Swift Relo, also reported a spike in business with expats currently working in HK seeking to leave because of the civil unrest or because they had lost their jobs. He said Singapore, Britain and the US were among the top destinations for those leaving.John Mullally, regional director at international recruitment group Robert Walters Plc, told the SCMP that the drop in the number of visas issued reflected the depressed jobs market across financial services and professional services in general.He said that, in 2018, four out of five job-hunters who consulted his company about working in the Far East favoured relocating to Hong Kong. But in 2020, that figure had plummeted and that he was now seeing growing numbers accelerating plans to leave the city.However, Mr Mullally felt the social unrest and the controversial national security law were only partially responsible for the current trend, which also reflected the tightening jobs market for expatriates who did not speak Mandarin.He added that he still expected more Western expats to come to work in Hong Kong over the next two years, although he did not see their numbers returning to pre-2018 levels.Simon Smith, senior director at Savills Asia & Pacific Research, told the Financial Times that, after rising political tensions between the US and China, social unrest and the new security law, the economic fallout from Covid-19 had been the “final gut punch” for expats thinking of leaving.“Many expats are involved in the financial services sector, which has been hit hard,” he said. “Hong Kong is a very expensive place to live if you haven’t got work.”Mr Smith said the decision last month to lower the minimum quota of non-Hong Kong students at the territory’s international schools from 70 to 50 per cent — probably because many schools had not been able to meet that quota — was a key indicator of the number of expats leaving.