Minimum wage to increase on May 1, 2013

Hourly salaries to rise by HK$30.00.

The government wants to raise the Hong Kong’s minimum wage by 7.1% on May 1, 2013. The median hourly wage for Hong Kong workers was HK$52.40 in June 2011, according to the government.

The proposal will increase the wages of 327,200 employees, or a tenth of the city’s workers. Chief Executive Leung Chun-ying said the income of employees at grassroots level has shown a significant improvement since the minimum wage policy was carried out last year.

This will be the first rise in Hong Kong’s minimum wage since it was implemented in May 2011. Inflation jumped 5.3% last year, and will rise by a further 4% this year, estimates the government. The wage increase should help residents hard hit by inflation and the world’s most expensive home prices.

Labor groups, however, sought to raise the minimum wage to HK$33.00 an hour. Employers, on the other hand, wanted to hold it at HK$28.00.

When Leung took over on July 1 as Chief Executive, some 112,000 people staged street protests to call for a higher minimum wage, and to protest against the widening income disparity in Hong Kong.

The average gross household income of the poorest 10% of the population fell 16% to HK$2,170 a month in 2011 from 2001, said the government. The comparable income for the richest 10% jumped to HK$137,480 a month, a 12% increase.

Home prices in Hong Kong continue to rise and remain the world’s most expensive, fueled by record low interest rates and an influx of mainland Chinese buyers.