Hong Kong workforce to start shrinking in five years

Low birth rate is also a problem.

Chief Secretary Carrie Lam warned of the dire consequences of the city's shrinking workforce, low birth rate and aging population.

In response, Hong Kong has launched a population strategy for public consultation. Areas to be discussed include how couples can be encouraged to have more children through incentives such as baby bonuses or longer parental leave.

The government is also seeking the public’s views on how to get more women and the elderly to join the workforce.

Ms Lam said that Hong Kong's average annual real gross domestic product growth in the past two decades was %. Of this, 1% was due to labor force growth and 3% to productivity.

"If the labor force shrinks, we will not achieve a 4% growth rate unless productivity rises substantially," she said.

Given current trends, the workforce will start contracting in five years when it peaks at 3.71 million.