Construction wage gap widens

With the price of building materials increasing over the years and with huge projects in the pipeline – the new Cotai casino resorts are a prime example – construction companies here decided to cut costs through workers’ salaries, namely the non-resident ones. Official data from the Statistics and Census Bureau reveals that despite an inflation of 6 per cent, and rent prices doubling every year, real wages in the sector have simply lagged behind.
Since 2010, the real wages (discounting inflation) of a local construction worker increased 29 per cent, while overall wages (including those of locals and non-residents) in the sector decreased by 2 per cent. This difference means that the salaries of non-resident workers dropped by much more than 2 per cent (DSEC does not cite a separate figure for this index). As with every average, it hides some truths. And one is that resident workers’ salaries are increasing at the same speed as construction materials, while non-resident employees are seeing their wages drop, widening the distance with their local colleagues.
By the end of 2014, a non-resident construction worker earned almost 40 per cent (37 per cent) less than a local one (MOP607 versus MOP955). But the difference increases as you go up the ranks for skilled and semi-skilled positions. For instance, a concrete formwork carpenter from Macau could command MOP1,242 per workday, while a non-resident in the same position received MOP649, or almost half.
Companies are also facing increases in construction materials costs. Since 2012, prices have risen by 10 per cent, with the cost of concrete skyrocketing 70 per cent up to December of last year. To accommodate this cost, construction firms had to cut or reduce staff costs, probably hiring more non-resident workers, data suggests. From 2010 to 2014, the price of construction materials went up by 29 per cent (together with local workers) but overall wages decreased 2 per cent.
In the fourth quarter, construction workers’ wages increased 6.1 per cent from the previous quarter with skilled and semi-skilled salaries going up by 6.2 per cent in line with inflation in the period. Unskilled workers, on the other hand, saw their salaries reduced by 0.5 per cent. In terms of construction materials, prices registered an upward variation of 2 per cent (concrete) to a drop of 3.8 per cent for steel bars.