Wage and payroll statistics for September 2022
According to the figures released today (December 29) 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 2.3% in nominal terms in September 2022 over a year earlier.
About 57% of the companies reported increase in average wage rates in September 2022 compared with a year ago. A total of 39% 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 decreased by 6.0% in real terms in September 2022 over a year earlier. The large decrease was mainly due to the large year-on-year increase of 8.9% in Consumer Price Index (A) in September 2022 arising from the low base of comparison resulted from the waiver of public housing rentals by Hong Kong Housing Authority in September last year.
As for payroll, the index of payroll per person engaged for all the industry sections surveyed increased by 2.0% in nominal terms in the third 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 decreased by 0.7% in real terms in the third 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.
For the nominal wage indices, year-on-year increases were recorded in all selected industry sections in September 2022, ranging from 0.9% to 3.3%.
For the real wage indices, year-on-year decreases were recorded in all selected industry sections in September 2022, ranging from 5.1% to 7.4%.
The year-on-year changes in the nominal and real wage indices for the selected industry sections from September 2021 to September 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 third quarter of 2022, ranging from 0.9% to 3.1%.
For the real payroll indices, year-on-year decreases ranging from 0.3% to 1.8% were recorded in the industry sections of manufacturing; import/export and wholesale trades; retail trade; transportation, storage, postal and courier services; real estate activities; and social and personal services in the third quarter of 2022. The other industry sections surveyed recorded year-on-year marginal increases of 0.2% to 0.3%.
The year-on-year changes in the nominal and real indices of payroll per person engaged for selected industry sections from the third quarter of 2021 to the third 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.
A Government spokesman said that nominal wages and labour earnings showed accelerated year-on-year growth in the third quarter of 2022 alongside the improved labour market conditions.
The average nominal wage rate for all selected industries rose by 2.3% year-on-year in September 2022, faster than the increase three months ago. After discounting for inflation, the average wage rate fell in real terms, but this was because the year-on-year increase in the headline Consumer Price Index (A) in that month was enlarged sizably by the low base of comparison caused by the Government's one-off relief measures implemented a year earlier. The underlying CPI(A) inflation in September 2022, which nets out the effect of the Government's one-off measures, was in fact lower than the increase in nominal wage.
Nominal payroll per person engaged, which includes basic wage, discretionary bonuses and other irregular payments, also registered an accelerated year-on-year increase of 2.0% in the third quarter of 2022. All selected industries saw increases in nominal payroll per person engaged, and the increases were faster than the previous quarter for most industries.
The latest figures were up to September 2022 only, and have yet to reflect the further improvement in the labour market lately. Looking ahead, nominal wages and labour earnings should continue to increase, though the pace of increase will hinge on the pace of further revival of domestic economic activities. The further relaxation of epidemic-related measures of late and the Consumption Voucher Scheme will help, though tightened financial conditions may partly offset the positive effects. It remains vital for the community to work together with the Government to keep the epidemic contained.
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, September 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: email@example.com).
Ends/Thursday, December 29, 2022
Issued at HKT 16:30
Issued at HKT 16:30