Loose reflections, continued

Last week, this column focused on the changes in the mainland economy, noting that there seems to be little thoughtful attention to its impacts on the local economy and society. Then, some issues associated with the so much desired, but mostly elusive, diversification of the economy were addressed. It is time to look into a specific aspect that was left out in the previous week – that is, the issue of human resources. This is, in many ways, a wider and more sensitive issue than just the development of ‘talents’, to use the current political jargon.
First of all, let us go back to a subject that is seldom reflected in the public discourse: demography. To be fair, it seems some departments are mindful of the topic. Until they report on their findings or reflections, however, it is difficult to gauge what kind of effect such awareness will have on public policy.
It is certain that at least until the beginning of the coming twenties the number of young residents joining the labour force will be declining. Their numbers may start to climb after that period, assuming most of them will stay in Macau. Some residents will also be leaving the labour force – retiring, opting out of the labour market or migrating. On balance, assuming other relevant factors remain constant, a slow increase in the residents’ labour pool is possible in the next decade.
That rise is likely, nevertheless, to be insufficient to answer the needs of a (hopefully) growing economy. That is, no matter how many and how well local ‘talents’ will be developed from now on, the economic growth will still require, to be sustained, a rising non-resident labour force. Given the current climate on the matter, their smooth integration is not a foregone outcome. And the gambling sector, and satellite operations, will still be the main drivers of employment growth, a fact that fits badly with the diversification imperative.
The temptation here may be that, over time, the stress will be increasingly put on the protection element – popular as it may be – and less on the actual development of skills – challenging as it is. The past suggests we should be careful in such approach. Until recently a major concern expressed by the local society was the high level of secondary school dropouts. But their behaviour was not irrational: they grasped, correctly, that they would benefit from special protection to do a job that required comparatively few skills. Besides, these could be acquired in a short term. As a result of such protection that job provided a comparatively high pay. Why should they keep studying for longer? To spend resources and time to reach the same end result, meanwhile sacrificing the income (and working experience) they would attain if they took the job earlier? This is but one example of the pitfalls and unintended consequences the real world sets even to the most well-meaning policies.