Hong Kong’s workforce is approaching salary expectations for 2026 with unprecedented caution, reflecting a significant shift from the more optimistic projections of recent years. According to a comprehensive survey conducted by the Federation of Hong Kong and Kowloon Labour Unions, employees are now anticipating modest salary increases of just 3 to 4 percent, a notable decline from the previously expected 5 to 7 percent range.

The survey, which gathered insights from 1,383 employees between June and September, reveals a complex economic landscape driving this conservative outlook. Persistent challenges such as ongoing inflation, rising living costs, and a civil servant salary freeze have created an atmosphere of financial uncertainty that is reshaping workers’ expectations and strategies.

Last year’s salary trends provide context for the current sentiment. Of the surveyed employees, 46 percent reported receiving a pay raise, while 48 percent experienced completely frozen salaries. This near-even split underscores the economic pressures facing Hong Kong’s workforce, with only a small percentage experiencing actual salary reductions.

The economic strain goes beyond headline inflation numbers. While overall inflation might appear moderate, specific cost increases—particularly in areas like transportation and housing—have significantly eroded workers’ purchasing power. Employees with stagnant wages are finding their real-world financial capabilities diminishing, leading to increased financial stress and declining living standards.

Workplace dynamics are compounding these challenges. Many employers have reduced hiring, forcing existing staff to absorb heavier workloads without corresponding compensation increases. This trend of overwork without adequate financial recognition has further fueled employee frustration and contributed to the cautious salary expectations.

Despite the generally conservative outlook, some sectors are showing more promising signs. Civil servants, public institution employees, and workers in catering, maintenance, and engineering industries are still anticipated to see salary increases. The union survey specifically recommended a minimum pay hike of 3.5 percent to help workers offset mounting financial pressures.

The underlying economic concerns driving this conservative approach are multifaceted. High unemployment rates and fears of job insecurity are making workers more hesitant about salary negotiations and future financial planning. The potential difficulty of securing new employment if laid off is creating a more reserved approach to workplace expectations.

Lawmaker Lam Chun-sing, who chairs the labor unions and conducted the survey, emphasized that these trends reflect more than just numerical shifts. They represent a broader narrative of economic adaptation and resilience among Hong Kong’s workforce. Workers are demonstrating a pragmatic understanding of the current economic environment, tempering their expectations while seeking strategies to maintain financial stability.

As 2026 approaches, Hong Kong’s employees are navigating a complex economic landscape characterized by uncertainty, measured optimism, and a keen awareness of the challenges ahead. The modest salary expectations are not a sign of defeat, but rather a strategic response to ongoing economic pressures—a testament to the workforce’s ability to adapt and persist in challenging times.

For those seeking deeper insights into these economic trends, staying informed through reliable sources and continuing to monitor labor market developments will be crucial in understanding the evolving dynamics of Hong Kong’s employment landscape.