“There have been times when job candidates didn’t show up for their interview as they received another offer. Even if you hired someone on the spot, he might not report for work,” he said.

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With a workforce of about 120 in Hong Kong and 80 more in mainland China, the staffing squeeze affected his development plans, forcing him to slow down expansion.

“We’ve turned down many projects,” Chien said.

He is among a rising number of innovation and technology (I&T) industry leaders who complain that Hong Kong does not have enough of the skilled workers they need, and an ongoing brain drain has made matters worse.

Cherrypicks boss Kenny Chien. Photo: SCMP

The city’s stringent Covid-19 curbs have driven away some expatriates and deterred others from coming. A wave of emigration has seen skilled Hongkongers leave. And global competition for the same people means fresh graduates can choose where to work, on the best terms available.

Chien said blockchain professionals, business analysts and software developers were among the most sought-after and without them, the city’s I&T development would suffer.

“If Hong Kong can find enough tech talent for the I&T sector, the industry’s gross domestic product can be doubled,” he said.

Impact of the worsening brain drain

The city’s workforce shrank by about 140,000 over the past two years, according to official data.

Some who left expressed frustration over the strict Covid-19 restrictions. Hongkongers unhappy with changes to the political environment after Beijing imposed the national security law in June 2020 took advantage of new migration pathways offered by Britain, Australia and Canada.

Several foreign companies also left, with the number of American firms operating regional headquarters in the city shrinking from 282 in 2020 to 254 last year.

Acknowledging the impact of the brain drain, Chief Executive John Lee Ka-chiu unveiled a raft of schemes last month to attract high-quality workers back to the city.

Hong Kong’s workforce has shrunk over the past two years. Photo: SCMP

A new Top Talent Pass Scheme will offer two-year visas to those earning at least HK$2.5 million (US$318,480) a year, or graduates of the world’s top 100 universities with at least three years’ working experience.

Companies will also be allowed to recruit from overseas for 13 professions facing manpower shortages, without having to prove they could not find suitable candidates in Hong Kong.

Lee included other sweeteners in his package, but the city faces intense competition in the region.

Singapore announced its own deal earlier, with an Overseas Networks and Expertise Pass offering five-year visas to top executives earning a fixed monthly salary of S$30,000 (HK$168,000).

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Australia’s global talent programme which began in 2019 offers instant permanent residence to highly skilled individuals from designated fields earning at least A$162,000 (US$110,000) annually. More than 1,000 Hongkongers were among those who have been accepted.

Hong Kong itself has long had a variety of schemes to attract quality tech workers from mainland China and overseas, and about 67,000 non-locals were admitted in 2019, before the pandemic struck.

The number fell by more than half to about 30,500 in 2020 and 32,200 last year.

Biomedical scientist Ricky Chiu Yin-to, chairman and CEO of biotech company Phase Scientific, said a shortage of tech workers almost disrupted his firm’s plan to develop coronavirus test kits during the pandemic.

He founded the company in the United States in 2015 and returned to Hong Kong in 2018 to focus on diagnostic tools for cancer, but when the pandemic arrived in early 2020, it switched to coronavirus test kits.

“We had a hard time hiring the right talent in Hong Kong,” he said.

Ricky Chiu, chairman and CEO of biotech company Phase Scientific. Photo: Handout

He tried making the employment package attractive, but finding people for research and development (R&D) was “like buying a football star”.

In the end, he leaned on his teams in Shenzhen and the US to work round the clock, and they succeeded in producing a Covid-19 nucleic acid test kit in three weeks.

“We were lucky to have people in the US and Shenzhen to compensate for our lack of labour in Hong Kong,” he said.

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To attract overseas professionals to Hong Kong, Chiu said he had offered pay packages 20 per cent above the market rate and covered accommodation too, because of the city’s high rents.

“You need to pay extra and add incentives to make them comfortable living and working here for a relatively long period,” he said.

He warned that if the lack of tech workers continued, investors would be discouraged from putting their money in Hong Kong I&T development.

Too few students choosing tech courses

Aside from the missing foreign hires and Hongkongers emigrating, the city has also been producing far fewer tech graduates than it needs for some time now.

There could be a total shortage of 20,000 such workers this year, said Leonard Chan Tik-yuen, chairman of the Hong Kong Innovative Technology Development Association.

“The supply of I&T graduates has been seriously inadequate, with only about 2,000 each year, which fails to meet about 8,000 vacancies in the sector every year,” he said.

Since the pandemic, many mainland Chinese and overseas graduates had preferred to stay home instead of working in Hong Kong, he added. At the same time, he said, more than 10,000 of the I&T sector’s workforce of over 140,000 had left.

Chan said the city’s education system had failed to meet rising demand for cutting edge technologies such as artificial intelligence, telecommunications, robotics, big data, biotechnology and cloud technology.

Hong Kong’s high cost of living makes it hard to attract talent. Photo: SCMP

It was hard to attract high-calibre people from overseas because of Hong Kong’s notoriously high cost of living and education for children or foreigners.

“Many of them have families and when they consider whether to work in Hong Kong, they need to think about international schools and housing. The sky-high living cost is a deterrent,” he said.

Chan suggested setting aside a site in the Lok Ma Chau Loop, where a major hi-tech hub was being developed, to offer low-rent accommodation to overseas I&T hires who came to Hong Kong.

“The government needs to think of some lucrative incentives, such as housing and education perks, to entice them to come to Hong Kong and stay for a long period,” he said.

‘More pay for job in Hong Kong’

The Hong Kong government has invested more than HK$150 billion (US$19.1 billion) in I&T development over the past five years, including an injection of HK$10 billion to establish InnoHK Clusters to conduct global collaborative research involving world-renowned universities.

Venture capital investment also rose from HK$1.24 billion to nearly HK$42 billion.

The result is that there are plenty of opportunities for qualified people.

Recent graduate Kenny Xie Wei-hao, 23, originally aspired to work at Shenzhen-based tech multinational Tencent Holdings, but changed his mind after two internships and decided to take a job in Hong Kong.

As an information systems undergraduate at the University of Science and Technology, the Hongkonger was bowled over by his first internship at Tencent in the summer of 2019.

“It was an eye-opener,” he recalled. “I was totally amazed by the innovative atmosphere. Everyone was outstanding with a heavy tech background.”

06:19

High hopes for China’s Greater Bay Area, but integrating 11 cities will pose challenges

High hopes for China’s Greater Bay Area, but integrating 11 cities will pose challenges

His second stint last year was with Tencent Cloud in October, when he worked as a salesman at its smart transport department. This time, he felt overwhelming pressure at work and was somewhat disenchanted.

“The job was highly demanding with a lot of performance indicators. The office politics was very serious and there were not many learning opportunities either,” he said.

He quit after almost a year, returned to Hong Kong and quickly landed a job last month at the local branch of a mainland Chinese tech firm selling robotic and artificial intelligence software.

Pleased that his salary was 30 per cent more than what he received at Tencent, Xie said: “I believe there is greater room for development in Hong Kong as the government has rolled out a lot of initiatives to support the industry and the commercialisation of R&D results such as the tech development in the Lok Ma Chau Loop and the Northern Metropolis.”

He felt there were also tremendous opportunities for the city’s tech firms to tap the Greater Bay Area market, as Beijing pursues its ambition to link Hong Kong, Macau and nine cities in Guangdong and create an economic powerhouse by 2035.

Biomedical scientist Ricky Chiu agreed, saying Hong Kong’s new Top Talent Pass Scheme was more aggressive than Singapore’s bid to attract quality professionals.

“The authorities changed their attitude from ‘come if you like’ to ‘come and explore’, and this approach is more suitable when it comes to luring talent,” he said.

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Heiwai Tang, an economics professor at the University of Hong Kong’s business school, said there were three ways to grow the talent pool – train young people locally, hire qualified individuals from overseas and attract foreign enterprises to set up base in the city.

“We need to start cultivating local students when they are in secondary school, encouraging them to choose engineering and technology-related majors in university,” he said.

Tang urged the government to do more to attract foreign investment to fuel the development of many big tech companies and the public tech sector.

Attracting firms such as Huawei would create a ‘chain reaction’, an expert says. Photo: AFP

This included encouraging mainland and foreign enterprises to establish branches in the city.

All that, along with luring high-quality individuals with attractive packages, would help create the right ecosystem to develop the I&T sector.

“Once the sector is developed, I’m sure young people, including university students, will respond to the new opportunities,” he said.

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Chan, of the Innovative Technology Development Association, also suggested that the government attract leading tech conglomerates to set up R&D centres and put their money in Hong Kong.

Some possibilities were Huawei Technologies Co, the Chinese telecoms equipment giant currently bogged down by US trade sanctions, and other mainland tech companies facing possible delisting in the US.

“If Huawei is willing to set up an R&D centre in Hong Kong, top talent will fight to work here and that will create a chain reaction,” he said.

“Similarly, if Hong Kong can attract more Chinese tech firms to seek a listing in the city, overseas talent will definitely set their sights on Hong Kong.”

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