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Overall Wage and Payroll Statistics
According to the figures released today (June 27) by the Census and Statistics Department, the average wage rate for all the major sectors surveyed, as measured by the wage index, rose by 0.7% in nominal terms in March 2006 over a year earlier.
About 51% of the companies recorded some increase in average wage rates in March 2006 compared with a year ago. On the other hand, 36% of the companies recorded some decrease in average wage rates over the period. The remaining 13% reported almost no change in average wage rates.
After discounting the increase in consumer prices as measured by the Consumer Price Index (A), the overall average wage rate for all the major sectors surveyed dropped by 0.7% in real terms in March 2006 over a year earlier.
As for payroll, the index of payroll per person engaged for all the major sectors surveyed increased by 1.3% in nominal terms in the first quarter of 2006 over a year earlier.
After netting out the effect of the increase in consumer prices as measured by the Composite Consumer Price Index, the average payroll per person engaged decreased by 0.3% in real terms in the first quarter of 2006 over a year earlier.
The wage rate includes basic wages and other regular and guaranteed allowances and bonuses. Payroll includes elements covered by wage rate as well as other irregular payments such as discretionary bonuses and overtime allowances. The payroll statistics therefore tend to show relatively larger quarter-to-quarter changes, affected by the number of hours actually worked and the timing of payment of bonuses and back-pay.
It should also be noted that the wage indices cover employees up to the supervisory level (i.e. not including managerial and professional employees). Payroll indices, on the other hand, cover employees at all levels and proprietors actively engaged in the work of the establishments.
Sectoral Changes
For the nominal wage indices, year-on-year increases were observed in the manufacturing sector and the financing, insurance, real estate and business services sector in March 2006, by 2.8% and 4.0% respectively. Yet for the wholesale, retail and import/export trades, restaurants and hotels sector, a marginal decrease of 0.2% was recorded. As for the transport services sector and the personal services sector, the decreases were 0.8% and 1.5% respectively.
For the real wage indices, year-on-year increases were observed in the manufacturing sector and the financing, insurance, real estate and business services sector in March 2006, by 1.4% and 2.5% respectively. Yet for the wholesale, retail and import/export trades, restaurants and hotels sector, the transport services sector and the personal services sector, year-on-year decreases were recorded, ranging from 1.6% to 2.9%.
The year-on-year changes in the nominal and real wage indices for the selected major sectors from March 2005 to March 2006 are shown in Table 1.
As for payroll per person engaged, year-on-year increases were recorded in the manufacturing sector, the wholesale, retail and import/export trades, restaurants and hotels sector, and the financing, insurance, real estate and business services sector in the first quarter of 2006, ranging from 1.3% to 5.6%. On the other hand, there were 0.4% and 3.4% year-on-year decreases in the community, social and personal services sector and the transport, storage and communications sector respectively.
As for the real payroll indices, there were 0.5% and 4.0% year-on-year increases in the wholesale, retail and import/export trades, restaurants and hotels sector and the financing, insurance, real estate and business services sector respectively in the first quarter of 2006. On the other hand, year-on-year decreases were registered in the manufacturing sector, the community, social and personal services sector and the transport, storage and communications sector, ranging from 0.3% to 4.9% in real terms.
The year-on-year changes in the nominal and real indices of payroll per person engaged for selected major sectors from the first quarter of 2005 to the first quarter of 2006 are shown in Table 2. The quarterly changes in the seasonally adjusted nominal and real indices of payroll per person engaged between the first quarter of 2005 and the first quarter of 2006 are shown in Table 3.
Other information
Both wage indices and payroll indices are compiled quarterly based on the results of the Labour Earnings Survey conducted by the Census and Statistics Department (C&SD).
It should be noted that wage statistics are conceptually different from the payroll statistics. Firstly, wage rate for an employee refers to the sum earned for his normal hours of work. It covers basic wages and other regular and guaranteed allowances and bonuses, but excludes earnings from overtime work and discretionary bonuses, which are however included in payroll per person engaged. Secondly, the payroll index of an industry is an indicator of the simple average payroll received per person engaged in the industry. Its movement is therefore affected by changes in wage rates, the number of hours of work and occupational composition in the industry. In contrast, the wage index of an industry is devised to reflect the pure changes in wage rate, with the number of hours of work and occupational composition between two successive statistical periods being kept unchanged. In other words, the wage index reflects the change in the price of labour. Thirdly, wage index only covers employees up to the supervisory level, whereas payroll index covers employees at all levels and proprietors actively engaged in the work of the establishment. Because of these conceptual and enumeration differences between payroll and wage statistics, the movements in payroll indices and in wage indices do not necessarily match closely with each other.
It should also be noted that different consumer prices are used for compiling the real indices of wage and payroll, taking into account their relevance to the respective occupation coverage. Specifically, the Composite Consumer Price Index, being an indicator of overall consumer prices, is taken as the price deflator for payroll of employees at all levels of the occupational hierarchy. The Consumer Price Index (A), being an indicator of consumer prices for the middle to lower income groups, is taken as the price deflator for wages in respect of workers on occupations up to the supervisory level.
Detailed breakdowns of the payroll and wage statistics are published in the "Quarterly Report of Wage and Payroll Statistics, March 2006". Users can download this publication free of charge at the "Statistical Bookstore, Hong Kong" (www.statisticalbookstore.gov.hk) of the Census and Statistics Department (C&SD). Print version of this publication is available for sale at HK$39 per copy. Purchase can be done in person at the Publications Unit of the C&SD (Address : 19/F Wanchai Tower, 12 Harbour Road, Wan Chai; Tel. : 2582 3025) or through mail order by returning a completed order form which can be downloaded from the C&SD's website (www.censtatd.gov.hk/products_and_services/other_services/provision_of_stat/mail_ordering_of_publications/index.jsp). Print version of this publication is also available for sale online at the Statistical Bookstore and the Government Bookstore of the Information Services Department (www.isd.gov.hk/eng/bookorder.htm). Print versions if purchased online are offered a discount, at 85% of their original prices.
For enquiries on payroll and wage statistics, please contact the Census and Statistics Department at 2887 5550.
Ends/Tuesday, June 27, 2006
Issued at HKT 16:17
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