Globalisation, Unemployment and the Welfare Regime in Hong Kong

Abstract

Hong Kong has a liberal economy, and its welfare regime relies, first, on income through employment and, second, on support provided by family and community members. Although the government has strategically invested in certain social services, generally speaking, its aid is intended to be a secondary, if not the last resort. This system was effective when Hong Kong benefited from globalisation, enjoyed virtually full employment in the decades preceding the mid-1990s. However, the changes in capital flow and increasing capital relocation to Mainland China have had a negative impact on employment. As a result, the current welfare regime is unsustainable. The neo-liberal ideologies adopted by the government have only led to further social polarisation and instability. It is time for an approach that combines balanced development with broader social support.