A growing number of Hong Kong-based financial professionals are considering career moves abroad following a tumultuous period for the city that has spanned violent street protests to U.S.-China trade tensions, not to mention a new security law and the coronavirus pandemic.
Recruitment and relocation companies in the city say they are seeing an uptick in inquiries from financial professionals about job opportunities outside the Chinese special administrative region.
"People are looking to move. Up until 12, 15 months ago, that conversation very rarely happened," said John Mullaly, regional director for southern China and Hong Kong financial services at Robert Walters Group, estimating that half of the job seekers on the London Stock Exchange-listed recruitment company's books say they are open to opportunities outside of Hong Kong, compared with a fifth in 2017-2018.
Robert Sheffield, managing director for greater China at Morgan McKinley, another global recruiter, says it is experiencing a similar trend. "We're seeing ... a much higher volume of people asking to explore external opportunities outside of Hong Kong ... we've certainly seen an increase in people not coming to Hong Kong," he said.
Y.B. Ng, senior vice president at global relocation company Asian Tigers, said inquiries to exit the financial hub have risen by 25% to 30% year over year.
Hong Kong's financial services sector plays a prominent role in the city's economy, contributing nearly 20% to GDP, according to an April report from the Census and Statistics Department. In 2018, the financial services sector employed 263,000 people, or around 7% of total employment in Hong Kong.
The seeds were sown in June 2019 as protests erupted following news that the Hong Kong government was planning to allow the extradition of criminal suspects to mainland China. That was seen by some as an erosion of Hong Kong's autonomy and Beijing's "one country, two systems" approach. Further disruption followed in 2020 in the form of COVID-19 and Beijing's introduction of a national security law that bans secessionist and subversive activity, partly in response to the protests in the city.
Against this backdrop, Hong Kong fell to sixth place from third place in the March edition of the Global Financial Centres Index, a ranking compiled twice a year by Z/Yen Group in partnership with the Shenzhen-based China Development Institute that assesses a range of criteria, including business-friendly operating conditions.
Hong Kong's international partners such as Britain, U.S., Canada and Australia said the law violates Beijing's obligations to guarantee Hong Kong's "one country, two systems" regime. Zhang Xiaoming, a deputy director of the central Chinese government office for Hong Kong, said the law is meant to punish a "tiny number of criminals" who endanger national security and that a separate legal system under mainland laws would be used for more serious national security cases, The New York Times reported June 30.
S&P Global Ratings said in a July 20 report that the city's perceived strengths as a robust financial center is at risk of being diluted by policy uncertainty, social unrest and rising competition from China's Greater Bay Area, a megalopolis in southern China that includes Hong Kong, Macau and several mainland China cities in the Pearl River Delta.
Joseph Lai, general manager at relocation company UniGroup Asia, said it has been seeing an increase in requests for potential employees that wish to be relocated to other Asia-Pacific locations, due to "a combination of job opportunities in other locations, schooling, protests and COVID-19, rather than as a direct causation of the national security law."