Demographic changes are often overlooked in societies’ evolution. Yet, they are among the most stubborn facts in framing such evolution. For example, changes in birthrates alone are connected to changes in a country or region’s economic potential and social structure. But the effects will be mostly felt well down the line.
First, when the successive (growing or diminishing) cohorts reach the labour market, some twenty years later. Then again, when most of them retire from their active working lives. There is no way to go back decades and switch to rates more suited to accommodate, so to speak, the later needs of the economy and social stability.
Macau provides an excellent example of such issues. The economic boom we saw seen after 2004 would not have been possible without significant migration inflows. The ageing of the labour force is another side of the equation. Again, it will bring the size and composition of the non-resident workforce to the fore.
But migration flows work both ways according to the economic tides. The current crisis was particularly hard-hitting for non-resident workers. Their size reached a peak in late 2019 when they were on the edge of the 200,000 level.
With data for the first quarter of 2021 now available, a figure that may nonetheless be underreported, we find the number decreased by 12 per cent since its peak. Despite a few positive signs for the economy in the first quarter (compared with the dramatic first half of 2020), their total number was still declining.
The brunt of the losses, in absolute terms, as might be expected, was felt among the non-resident workers coming from mainland China. They represented almost half of the decrease, followed by the Philippines, with nearly 15 per cent.
However, in relative terms, workers from Malaysia and Thailand suffered most, going down by about 30 per cent. The supply from Hong Kong also suffered a significant blow, standing now one quarter below its peak level.
These losses represent for the local labour force a welcome employment safeguard. But they will not come without costs. First, they impact aggregate consumption levels in ways that are significant for local commerce and services segments.
Further, they are bound to affect negatively the potential supply of many sectors, namely those directly connected to tourism, which is most labour-intensive. The loss of workers is also the loss of skills and routines that took time and practice to develop – and will take time to rebuild.