Pressure on Hong Kong’s Middle Class

Memories of those glorious, heady pre-1997-crash days must seem awfully sweet to many of HK’s increasignly pinched middle classes. Just like memories of America before the crash of 2000 and the election of Bush shortly afterwards seem to me. It was a way of life that, in a flash, was gone with the wind, and I don’t think we’ll ever see anything like it again in our lifetimes. Hong Kong’s middle class is still hurting, and it’s not getting better anytime soon.

Hong Kong’s economy might have grown by an estimated 7 percent last year and outshone many others in the region, but for insurance agent Ngai Wai-wang, that is immaterial.

Ever since the Asian economic crisis of 1997, his earnings have fallen sharply and he can only afford to eat out with his wife and two sons once a week. Exotic vacations are now just a memory in their photograph albums.

“We choose cheaper destinations in Asia now, like Thailand. My mortgage eats away half my salary, and my two sons, 12 and 14, are growing up and they need more money,” said Ngai, 51.

Ngai takes home around HK$50,000 (US$6,400) a month and is a middle-income earner in Hong Kong. Unlike 40 percent of wage earners in this city who pay no income tax, he pays taxes but has not seen his wages rise appreciably since the late 1990s.

“I don’t see any improvement in our lives. We have few benefits and we are taxed very heavily. The recovery is superficial and due to more Chinese tourists arriving. That’s good for the retail sector. But no one else benefits,” he said.

“If the economy was benefiting us, we would spend lavishly like before, but we count every penny now. The government should cut taxes. That way we consume more and that’s good for society.”

Hong Kong is set to announce a second straight budget surplus for the 2005/06 fiscal year on Wednesday, thanks to strong economic growth and higher asset prices.

I think about how different my own life is compared to those days in the late 1990s, when flying economy class would have been just too humiliating. The good side to the story is that after the fall, we all grew up fast, adapted to our new reality and realized we could still have our dignity and value, even if we had to sit in the back of the plane. Life may be harder, but there’s still plenty to savor.

The Discussion: 12 Comments

No wonder something like this is being put to hold.

February 22, 2006 @ 1:08 am | Comment

The project apparently is the pride and joy of the new Chief Executive Doanld Tsang. Unfortunately his opponent is turning it into a kind of “hot potato” that no one wants to touch it anymore. So the abandoning of the project has got more to do with politics than economics. This is what I heard. So correct me if I’m wrong, particularly those of you who are more informed of HK issues.

February 22, 2006 @ 1:26 am | Comment

6.4k a month is middle class these days? Damn, I need to readjust my scale here. To me 6.4k/month says, “doing pretty good thank you very much.” Granted living in Hong Kong certainly can’t be cheap, I have somewhat of a hard time pitying him all that much considering the average Japanese salary man makes 2.8k/month ( — data just released the first of this month for last year, the first increase in 8 years — also that is the average for the whole country, but 10% of the population lives in Tokyo, where they average 3x the income of their friends in Osaka). (I’ve seen somewhere the average income for a 50’s man in Tokyo is still only 4.2k/month, but I can’t find a source right now.)
Perhaps he needs to consider getting his wife a job.
As for you people who are not happy about riding coach, I HATE YOU and I hope to be you some day, eheheh

February 22, 2006 @ 4:20 am | Comment

HK$50K a month isn’t chopped liver, when the average wage is about HK$10-12K a month.

And Fat Cat, it is politics intersecting with economics in that typical Hong Kong style. Another government project designed to create large profits for a small coterie of tycoons, while dressed up in sheep’s clothing of helping culture.

But when you’re proclaiming to help culture and even the conductor of the local philharmonic speaks out against the project as not helping develop culture here, people have started to get sick of the charades and demand some truth in advertising and perhaps a dab of transparency in government as well.

February 22, 2006 @ 6:54 am | Comment

Richard, you used to fly on public planes?

Sheesh, I didn’t know you were so hard up, buddy! Look, next time you’re going back to the States, just let me know, you can use my wings, okay? Just don’t forget to tip the pilot.

Oh, and please try not to make a big mess. I let Other Lisa use my plane once, the staff complained for weeks afterwards about the cat hair.


February 22, 2006 @ 8:48 am | Comment

Ngai takes home around HK$50,000 (US$6,400) a month and is a middle-income earner in Hong Kong. Unlike 40 percent of wage earners in this city who pay no income tax, he pays taxes but has not seen his wages rise appreciably since the late 1990s.

Poor guy. That’s about $77,311USD, or only 187% of what the average American does. Heck, it’s only 2.7 times as much as an average HKer. Gosh, sure am glad I’m not suffering like that. Poor guy.

February 22, 2006 @ 9:00 am | Comment

I’m with Darin and Slim here… it never occurred to me that ‘real’ people I’ve met/know could actually fly anywhere other than economy. That’s the mindset of an EFL teacher all right.

February 22, 2006 @ 9:01 am | Comment

“Ngai takes home around HK$50,000 (US$6,400) a month and is a middle-income earner in Hong Kong. …………………
…………………………, but we count every penny”

The middle-class income of HKer is HK$12,000~HK$26,000

In different culture, some people tend to either boast what he has to make you jealousy or what he suffers to solicit sympathy or doing both.

Just listen and smile, don’t get fooled.

February 22, 2006 @ 1:20 pm | Comment

“just too humiliating”

Heh. In 2000 I took a job with an international company, which just a few weeks earlier had stopped paying for business-class seats for international travelers (which was just about all of us). The moaning and whining went on for *months*.

As someone who hadn’t (and STILL hasn’t) enjoyed the ineffable pleasures of transatlantic business class, I was highly amused.

February 22, 2006 @ 2:21 pm | Comment

At HK$12,000 a month, taxes are 1.2% (HK$1,720 p.a.). At HK$26,000/mo (US$40,000 p.a.), it jumps to 10.1% ($31,600). Of course, if you have a wife and kid it is free at $12,000 and only 1.5% ($4,680) at $26,000 a month.

You can run your own numbers in about 4 seconds at

February 23, 2006 @ 12:48 am | Comment

When I worked in HK I never had close to that income, and there was never a month where I succeeded in spending all my pay. I just ended up saving because I couldn’t think of anything else I wanted to buy.

February 23, 2006 @ 2:09 am | Comment

FSN, just send it on over to me. There’s a PayPal button on the top left-side of my homepage.

February 23, 2006 @ 2:11 am | Comment

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