March 23, 2010

• <收入及工時按年統計調查報告 : Some comments – Part 3>

  Part 1

  Part 2

  The implications of higher actual hours of work

  I have assumed in the previous part that across all industries, occupations and gender (and other aspects) the actual working hours are higher than the one collected by the Census and Statistics Department under that definition.

  If this is the case, the actual hourly wage must necessarily be lower than the report one (Median : $58.5 per hour).

  But my rough idea is that, unpaid over-time is a very prominent and widespread phenomenon in the following industries – only mentioning those covered by the report (figures in the brackets are their median hourly wage) :

  — Financial and insurance activities ($105.9) : While iBankers (who worked from 8 am to 4 am) constitute only a small population, most employee in this sector really work till late.

  — Information and communications ($80)

  — Professional, scientific and technical activities ($90.8) : Accountants, lawyers and other professionals are in this category.

  — Education and public administration (excluding Government) ($129) : Some of my xanga friends, Fongyun, Kursk, Tommyjonk and Johncoal are all here. Ask them what their actual working hours are.

  Incidentally, the hourly wages in 3 of these 4 industries are the highest in all industries surveyed. That means, in these industries, the hourly wage basing on actual working hours are lower than the report one. In turn, the overall median hourly wage, should also be lower, even assuming the actual working hours for other industries are the same as reported under the definition of “contractual hour”.

  More importantly, since we are adopting a “median” hour of work, no matter how the numbers below the median get lower, they have no impact on the median.

  Let’s consider this example : 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11

  Median : 6

  Case 1 : All numbers below 6 are cut by 20%

  0.5, 1, 1.5, 2, 2.5, 6, 7, 8, 9, 10, 11

  Median : 6

  Case 2 : All numbers above 6 are cut by 20%

  1, 2, 3, 4, 4.8, 5, 5.6, 6, 6.4, 7.2, 8, 8.8

  Median : 5

  Though not perfectly correct, the above example means, in lowering the median, it is far more effective to work on the numbers above the median (and reversely, if you want to boost your median, all you need to do is to work on the numbers below the median).
  
  In other words, if we were to use actual working hours only for those highly paid industries, we should possibly see a substantially lower hourly wage for all industries as a whole.

  —-

  But is it fair to say those highly paid industries have lower hourly wage, basing on actual hour of works? It depends.

  The hourly wage concept for such industries are, unfortunately, useless. Why? Because employee i in these industries work throughout the year, in the expectation that they could receive discretionary bonus/ performance-based bonus at the end of the year (which are both excluded in the study).

  The definition of wage published in this report follows the definition as adopted in the Employment Ordinance. In brief, the following components are covered:

  (i) Basic wage/salary;

  (ii) Commission and tips not of gratuitous nature;

  (iii) Guaranteed bonuses and allowances other/than guaranteed year-end bonus/payment (e.g. shift allowance, cost-of-living allowance, meal allowance, good attendance bonus not of gratuitous nature); and

  (iv) Overtime payment.

  
  Wage in this report does not include:

  [(i) to (vi) are skipped]

  (vi) End of year payment, or annual bonus which is of a gratuitous nature or is payable only at the discretion of the employer

  It is very debatable whether discretionary bonus should be counted. But such exclusion should be borne in mind whether interpreting the hourly wage for these high-paid industries.

  • 12:15 pm
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