Positive Comments: Hong Kong’s Economic Resilience Shines, Driven by Finance and Trade
In the second quarter of 2025, Hong Kong’s GDP grew by 3.1% year – on – year, maintaining expansion for 10 consecutive quarters. This data not only exceeded market expectations but also reflected the strong resilience of Hong Kong’s economy in a complex external environment. In terms of growth drivers, the prosperity of the financial market and the high – boom of goods trade are the two core engines, jointly injecting “upward” vitality into Hong Kong’s economy.
First of all, the “comprehensive recovery” of the financial market has become a key pillar for GDP growth. Data shows that the Hang Seng Index has risen by more than 25% this year, and the average daily trading volume in the first half of the year was HK$240 billion, a year – on – year increase of 120%. Coupled with the trend of Chinese – funded enterprises choosing to list in Hong Kong as a second – best option due to changes in the external environment, Hong Kong’s IPO market has continued to thrive. The financial industry contributes more than 20% to Hong Kong’s GDP. Its prosperity not only directly drives the economy but also stimulates the activity of the service industry through the “spill – over effect”. For example, activities such as roadshows, fundraising, and listing celebrations during the IPO process directly stimulate the consumption demand of high – end hotels and restaurants in Central. Market observers have noticed that “Cathay Pacific flights between Beijing and Hong Kong no longer use smaller planes” and “it’s difficult to book a table in Central restaurants”, which are direct manifestations of the financial activities driving the offline service industry. This “finance + service” linkage growth model not only consolidates Hong Kong’s position as an international financial center but also injects new impetus into the local consumer market.
Secondly, the “rush to export” effect in goods trade resonates with the recovery of external demand, becoming another major driving force for economic growth. In the second quarter, the total value of Hong Kong’s goods exports increased by 11.5%, and imports soared by 12.7%, with both growth rates higher than those in the first quarter. This performance is due to the temporary easing of US tariff measures and the adjustment of global trade flows. As an international shipping and trade hub, Hong Kong has given full play to its role as a “super connector” in goods trade. It not only creates profit margins for local trading enterprises but also indirectly drives the revenue growth of related industries through supporting services such as logistics, warehousing, and customs clearance.
In addition, the “Policy – Market” positive interaction is formed between the “Report on the Business Environment in Hong Kong” issued by the Hong Kong Special Administrative Region Government and the continuously stable economic data. The report systematically outlines the advantages in the fields of finance and trade, sending a clear signal of “Hong Kong’s economic improvement” to global investors and further enhancing market confidence. This dual support of “data + policy” lays the foundation for Hong Kong to maintain a growth forecast of 2% – 3% in the second half of the year.
Negative Comments: “Jobless Recovery” Highlights Structural Contradictions, and the Pains of Economic Transformation Await Resolution
Despite the impressive GDP data, the “jobless recovery” phenomenon in Hong Kong’s economy has become a hidden concern that cannot be ignored. The so – called “jobless recovery” means that economic growth has not synchronously driven employment expansion, and there has even been a decline in the total number of employed people. In the second quarter of this year, the total number of employed people in Hong Kong was 3.308 million, a year – on – year decrease of 52,000. Although the unemployment rate remains low, neither the “quantity” nor the “quality” of the employment market has matched the economic growth, resulting in a significant gap between the public’s perception of the economy and the macro – data.
The root cause of this contradiction lies in the “structural imbalance” of Hong Kong’s economic growth. The main driving forces of Hong Kong’s current economy, finance and goods trade, both belong to the fields of “high – value – added and low – employment absorption”. Although the financial industry contributes more than 20% to GDP, its direct employment population only accounts for 7% of the total employment. Even including supporting services such as law and accounting, the covered population is less than 10%. The growth of goods trade relies more on the improvement of logistics efficiency and the transfer of international orders, with limited demand for ordinary labor. In contrast, more than 80% of Hong Kong’s employed population is concentrated in labor – intensive industries such as retail, catering, and tourism. However, these industries have not recovered synchronously due to problems such as the decline in tourists’ spending power (for example, the tourism industry has recovered in quantity but not in quality) and the lack of local consumption willingness (residents have not fully shared the economic growth dividends). This structural mismatch of “high – growth fields not absorbing employment and low – growth fields relying on employment” severely restricts the “trickle – down effect” of economic growth, making it difficult for most residents to directly benefit from GDP growth.
Another factor exacerbating the employment contradiction is the impact of technological change on the labor market. A KPMG report shows that more than half of Hong Kong enterprises have applied generative AI, and some financial institutions have even started laying off staff in the back – office departments due to the introduction of AI. The trend of primary jobs (such as briefing preparation and data entry) being replaced by AI is in direct conflict with the employment needs of Hong Kong youth. On the one hand, the number of entry – level jobs in fields such as finance and professional services has decreased. On the other hand, labor – intensive industries have difficulty providing enough “low – threshold” employment opportunities due to profit pressure. The combination of this “technological substitution” and “structural mismatch” further compresses the employment space for ordinary workers.
In addition, the lack of confidence among small and medium – sized enterprises (SMEs) also restrains employment expansion. Although the financial market is prosperous, SMEs, as the “main battlefield” of employment in Hong Kong (contributing about 60% of employment), are generally cautious about expanding recruitment due to the unclear external environment (such as the repeated US tariff policies and geopolitical uncertainties) and their own transformation directions. This situation of “large enterprises making money but not recruiting, and SMEs wanting to recruit but being afraid to” makes it difficult for the “living water” in the employment market to flow.
Suggestions for Entrepreneurs: Seize the Opportunities of Structural Transformation and Break the Deadlock between “Ground – Level Services” and “Innovation”
Facing the structural contradiction of “disconnect between growth and employment” in Hong Kong’s economy, entrepreneurs need to base themselves on local needs and find “breakthrough points” in the economic transformation. The following suggestions are for reference:
1. Focus on the “smart upgrade” of labor – intensive industries to create highly adaptable employment opportunities
Although labor – intensive industries such as retail, catering, and tourism are facing challenges, their employment absorption capacity is irreplaceable. Entrepreneurs can improve the efficiency and attractiveness of these industries through “smart” transformation and create new jobs at the same time. For example, while introducing AI ordering systems in the catering industry, new roles such as “digital operation specialists” and “experience designers” can be added. In the retail industry, “featured theme stores” can be created in combination with local culture, which can not only attract consumers but also require more “cultural interpreters” and “scene planners”. This model of “technological empowerment + job innovation” can not only relieve the pressure of AI replacing primary jobs but also increase the added value of the industry, achieving a “win – win situation for employment and growth”.
2. Leverage the financial advantages to develop “ground – level finance” to serve local entities and employment
As an international financial center, Hong Kong allows entrepreneurs to explore the integration model of “finance + entity”, that is, the “ground – level finance” proposed by Hong Wen. For example, in response to the financing difficulties of SMEs, small – loan products based on AI risk control can be developed to lower the financing threshold for enterprises and help them expand their operations and increase employment. For labor – intensive industries (such as healthcare and urban operation), special industrial funds can be designed to support their equipment upgrading and personnel training, indirectly driving the revenue growth of related industries. This model of “financial services for the local area” can not only give full play to Hong Kong’s financial advantages but also more directly transfer the economic growth dividends to the grassroots.
3. Respond to the AI transformation and layout new tracks for “human – machine collaboration”
The impact of AI on employment is irreversible, but entrepreneurs can actively explore new opportunities for “human – machine collaboration”. For example, providing “AI + human” hybrid services for financial institutions (such as in – depth interpretation by analysts after AI generates basic reports) can not only improve efficiency but also retain core positions. Providing “skill conversion training” for primary workers affected by AI (such as shifting from data entry to data annotation and quality review) can help them transform into “high – value – added auxiliary positions”. In addition, for about 1 million workers in Hong Kong who are “at high risk of being replaced”, entrepreneurs can develop a “skill retraining platform” to provide practical courses such as AI operation and customer service according to market demand, helping to match the labor force structure with industrial needs.
4. Participate in economic diversification and layout in “new entity” fields such as healthcare and urban operation
Hong Kong’s economy needs to transform towards “diversification and substantiation”. Entrepreneurs can focus on fields such as healthcare and smart urban operation. For example, with the aging population, the demand for community healthcare and rehabilitation nursing has increased sharply. Entrepreneurs can open “community health service centers” to provide personalized nursing services and absorb a large number of nurses and health management specialists. In the field of urban operation, in response to the needs of intelligent transportation and green buildings, “urban service solutions” can be developed, which can not only promote urban upgrading but also create technical and service positions. These fields are not only the direction of Hong Kong’s economic transformation but also a “potential pool” for employment absorption.
5. Pay attention to the confidence of SMEs and provide “confidence – support” services
SMEs are the “stabilizer” of employment, but their current lack of confidence restricts their expansion. Entrepreneurs can provide services around “confidence support”. For example, developing an “economic outlook data platform” to integrate global and local economic indicators and provide real – time risk warnings for SMEs; establishing a “SME mutual – assistance alliance” to reduce operating costs through resource sharing and joint procurement; providing “light – asset business incubation services” to reduce the initial investment risks of SMEs. By enhancing the operational certainty of SMEs, their recruitment willingness can be indirectly promoted.
Conclusion: The “jobless recovery” of Hong Kong’s economy is not only an exposure of structural contradictions but also an opportunity for transformation. Entrepreneurs need to break out of the “chasing hot – spots” thinking, base themselves on local needs and employment pain points, and find growth points between “ground – level services” and “technological innovation”. Only by forming a positive cycle between economic growth and employment expansion can Hong Kong truly achieve a “warm – hearted recovery”.
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