CONFIDENTIAL #3

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workforce would shift to the services sector

(34)

However, in view of the difference in skills and

experience required for different jobs, changes in

employment could well not be smooth in some cases, and the adjustment process could be difficult. Older workers with limited or specialised skills could be a particular

problem.

43.

But these sectoral problems can be avoided or at least reduced if the pace of change is gradual. Rapid change is always more difficult to adapt to than gradual

change.

Role of Hong Kong Government in maintaining the

competitiveness of the local economy and its manufacturing

sector in particular

44.

(a)

Facilitation of product upgrading and innovating

At present, Guangdong's comparative advantage

lies in the provision of relatively cheap, unskilled workers for labour-intensive processes. A successful tende response to this by Hong Kong will require a shift away from such processes and towards those requiring greater

skills where Hong Kong's relatively more expensive workers

can continue to be competitive. By so doing, Hong Kong can maintain a competitive edge over Guangdong even in the

long term.

(34) Within the manufacturing sector, there would also be

a relative shift of the workforce to skill and/or knowledge intensive production processes from labour and/or land intensive production processes as the real wages of the former were likely to increase faster than the latter.

G.F. 326

·ནས་བསྟ་བ་ནནབརy y། དར ར “ -、、 ར བ ད ས ཏ ས དང"3,、,、:,

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