Overall wage and payroll statistics
 
     According to the figures released today (September 26) by the Census and Statistics Department (C&SD), the average wage rate for all the selected industry sections surveyed, as measured by the wage index, increased by 1.9% in nominal terms in June 2022 over a year earlier.
 
     About 55% of the companies reported increase in average wage rates in June 2022 compared with a year ago. A total of 41% of the companies recorded decrease in average wage rates over the same period. The remaining 4% reported virtually no change in average wage rates.
 
     After discounting the changes in consumer prices as measured by the Consumer Price Index (A), the overall average wage rate for all the selected industry sections surveyed increased by 0.1% in real terms in June 2022 over a year earlier.
 
     As for payroll, the index of payroll per person engaged for all the industry sections surveyed increased by 1.7% in nominal terms in the second quarter of 2022 over a year earlier. 
 
     After discounting the changes in consumer prices as measured by the Composite Consumer Price Index, the average payroll per person engaged increased by 0.3% in real terms in the second quarter of 2022 compared with 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 to workers 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.
 
Sectoral changes
 
     For the nominal wage indices, while most selected industry sections surveyed recorded a year-on-year increase in June 2022, ranging from 1.8% to 3.3%, the personal services section and transportation section recorded a year-on-year decrease of 0.1% and 0.6% respectively.
 
     For the real wage indices, year-on-year increases ranging from 0.1% to 1.5% were recorded in the manufacturing section, accommodation and food service activities section, financial and insurance activities section, real estate leasing and maintenance management section, and professional and business services section in June 2022. On the other hand, year-on-year decreases ranging from 0.1% to 2.3% were recorded in the import/export, wholesale and retail trades section; transportation section; and personal services section.
 
     The year-on-year changes in the nominal and real wage indices for the selected industry sections from June 2021 to June 2022 are shown in Table 1.
 
     As for the nominal indices of payroll per person engaged, year-on-year increases were recorded in all selected industry sections in the second quarter of 2022, ranging from 0.2% to 2.9%.
 
     For the real payroll indices, year-on-year increases ranging from 0.4% to 1.4% were recorded in the industry sections of sewerage, waste management and remediation activities; accommodation and food service activities; information and communications; financial and insurance activities; real estate activities; professional and business services; and social and personal services in the second quarter of 2022. The other industry sections surveyed recorded year-on-year decreases of 0.4% to 1.3%.
 
     The year-on-year changes in the nominal and real indices of payroll per person engaged for selected industry sections from the second quarter of 2021 to the second quarter of 2022 are shown in Table 2. The quarterly changes in the seasonally adjusted nominal and real indices of payroll per person engaged in the same period are shown in Table 3.
 
Commentary
 
     A Government spokesman said that the average wage rate for all selected industries rose by 1.9% year-on-year in nominal terms in June 2022, slightly faster than the increase three months ago. After discounting for inflation, the average wage rate edged up by 0.1% in real terms.
 
     Payroll per person engaged, which includes basic wage, discretionary bonuses and other irregular payments, also recorded a faster year-on-year increase of 1.7% in nominal terms in the second quarter of 2022, as domestic economic activities revived amid the generally moderated epidemic and relaxed social distancing measures.  Nominal payroll per person engaged in accommodation and food service activities, retail trade, and social and personal services resumed year-on-year increases, and that in many other industries posted accelerated growth.
 
     The spokesman added that as long as the local epidemic situation remains under control, the recent revival in local economic activities and improvement of the labour market should continue in the near term, thus rendering support to wages and labour earnings. It is therefore essential for the community to work in unison with the Government to bring the epidemic under control.
              
Other information
 
     Both wage indices and payroll indices are compiled quarterly based on the results of the Labour Earnings Survey (LES) conducted by the C&SD. Wage index only covers employees up to the supervisory level (i.e. not including managerial and professional employees), whereas payroll index covers employees at all levels and proprietors actively engaged in the work of the establishment.
 
     Apart from the differences in employee coverage, 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, 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 occupational composition between two successive statistical periods being kept unchanged. In other words, the wage index reflects the change in the price of labour. 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 price indices are used for compiling the real indices of wage and payroll to take into account the differences in their 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 workers at all levels of the occupational hierarchy. The Consumer Price Index (A), being an indicator of consumer prices for the relatively low expenditure group, is taken as the price deflator for wages in respect of employees engaged in 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, June 2022". Users can download the publication at the website of the C&SD (www.censtatd.gov.hk/en/EIndexbySubject.html?pcode=B1050009&scode=210).
 
     For enquiries on wage and payroll statistics, please contact the Wages and Labour Costs Statistics Section (1) of the C&SD (Tel: 2887 5550 or email: wage@censtatd.gov.hk).

Ends/Monday, September 26, 2022
Issued at HKT 16:30

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