THE ECONOMY
telecommunications, banking, real estate development, and professional services such as legal, accounting and insurance services. Hence, since the mid-1980s, the Hong Kong economy has become increasingly oriented towards services.
Reflecting this, the share of the tertiary services sector (comprising the wholesale, retail and import/export trades, restaurants and hotels; transport, storage and communications; financing, insurance, real estate and business services; community, social and personal services; and ownership of premises) in GDP rose steadily, from around 67 per cent in 1980 to 74 per cent in 1990, and further to 85 per cent in 1997.
Chart 3
Employment by broad economic sector
1
1980
1998*
Secondary production 50.1%
Secondary production 19.5%
Primary production 1.5%
Primary production 0.5%
Tertiary production 48.4%
Tertiary production 80.0%
With the on-going relocation of lower value-added and less skill-intensive manufacturing processes to the Mainland and steady expansion of service sector activities in Hong Kong, the tertiary services sector has long overtaken the secondary production sector to become the largest employer in the economy. * Average of Q1 to Q3 1998.
This structural change in the economy was also shown up in the sectoral distribution of employment. The share of the services sector in total employment rose markedly, from 48 per cent in 1980 to 63 per cent in 1990, and further to about 80 per cent in 1998. On the other hand, the share of the manufacturing sector in total employment was on a distinct downtrend, dropping from 42 per cent in 1980 to 28 per cent in 1990, and further to only about 8 per cent in 1998.
The Services Sector
The services sector has flourished and diversified in types of activities amid the structural change in the economy. Among the service industries, the growth and development in finance and business services, including banking, insurance, real estate, and a wide range of other professional services, has been particularly rapid.
During the decade from 1989 to 1998, exports of services expanded by an annual average of 4 per cent in real terms, and that of imports of services by 6 per cent. The major components of Hong Kong's trade in services are civil aviation, shipping,
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