Employment Characteristics and Trends of Tourist Related Industries - Macao

8/7/2019 Employment Characteristics and Trends of Tourist Related Industries - Macao

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Employment Characteristics and Trends of

Tourism-related Industries

W. M. CheongResearch and Statistics Department

,

Monetary Authority of Macao

Abstract

Tourism plays an increasingly important role in many economies, contributing to their

growth and job creation. In recent years, with the government promotion, regional

cooperation and the implementation of the Individual Traveller Scheme by the central

government, tourism has become the leading industry of the Macao economy. It has,

in particular, created many job opportunities in the labour market and become the

largest employer in the SAR. This paper attempts to draw on a number of

cosmopolitan characteristics and trends of employment in tourism and analyse their

relevance to Macao.



Employment Characteristics and Trends of Tourism-related Industries

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1. Introduction

Mainly attributable to the rapid development of the tourism sector, Macao has

experienced notably strong economic growth since 2001. In terms of GDP per capita,

Macao surpassed Japan for the first time in 2008 with a value of USD39,036.1 As an

engine of growth, tourism has impacted almost all fractions of the Macao economy.

To assess the tourism sector’s economic impacts, the World Travel and Tourism

Council (WTTC) makes use of the Tourism Satellite Account (TSA) to generate

country reports, presenting the contribution of tourism to gross domestic product

(GDP), foreign exchange earnings, employment and others. In particular, the WTTC

distinguishes the contribution of tourism to employment by two categories - “traveland tourism industry” (T&T industry) and “travel and tourism economy” (T&T

economy).

Table 1 shows the employment contribution of tourism in Asia and the Pacific area in

the years 2000 and 2008. Among selected economies, Macao showed strong

dependence in employment on tourism, which directly accounted for 37.6% of total

employment in both years. Regarding T&T economy, the proportion rose from

55.5% in 2000 to 70.7% in 2008. Aside from Macao, the top three economies in the

region with the highest proportion of direct employment were Fiji, New Zealand and

Australia, while taking direct and indirect impacts together, Fiji, Hong Kong and

Cambodia showed the highest reliance on tourism in employment.

This paper focuses on the contribution of tourism to employment. We intend to

identify the features of employment in tourism-related industries (TRIs) and analyse

their relevance to Macao. The next section reviews pertinent literature and

international surveys. Based on the framework established in Section 2, Section 3

analyses the characteristics and development of TRIs employment in Macao from five

key perspectives, including accessibility, flexibility, remuneration and working

condition, mobility and enterprise size. Concluding remarks are drawn in the last

section.

1

Japan’s GDP per capita was USD38,210 according to the World Development Indicators Database,World Bank, 1 July 2009. Qatar was reported to have the highest GDP per capita in Asia though the

data was not available in the World Bank publication.




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Table 1: Percentage Share of Travel and Tourism Jobs in Total Employment

Asia and the Pacific, 2000 and 2008

Travel & tourism

industry1

Travel & tourism

economy2

2000 2008

Variation

(ppt.) 2000 2008

Variation

(ppt.)

Australia 6.0 4.7 -1.3 13.0 11.0 -2.0

Bangladesh 1.1 1.3 0.2 2.8 3.2 0.4

Brunei 2.9 3.1 0.2 12.2 13.8 1.6

Cambodia 4.9 6.5 1.6 11.4 14.6 3.2

China 2.3 2.4 0.1 7.5 8.1 0.6

Fiji 9.3 9.3 0.0 23.4 24.7 1.3

Hong Kong, China 3.7 6.0 2.3 11.3 16.0 4.7

India 2.5 2.7 0.2 5.5 6.5 1.0

Indonesia 2.9 2.0 -0.9 7.8 6.5 -1.3

Islamic Republic of

Iran 2.9 2.7 -0.2 6.8 7.9 1.1Japan 4.2 4.0 -0.2 10.3 10.1 -0.2

Korea 2.4 2.1 -0.3 8.5 8.1 -0.4

Laos 3.9 3.3 -0.6 8.8 9.1 0.3

Macao, China 37.6 37.6 0.0 55.5 70.7 15.2

Malaysia 4.1 5.2 1.1 10.4 11.7 1.3

Myanmar 3.4 2.9 -0.5 6.5 6.1 -0.4

Nepal 2.9 2.0 -0.9 6.6 5.0 -1.6

New Zealand 7.2 5.6 -1.6 15.4 12.6 -2.8

Pakistan 1.8 1.7 -0.1 4.4 4.7 0.3

Philippines 3.8 4.0 0.2 11.2 10.5 -0.7

Singapore 3.5 2.1 -1.4 9.9 6.2 -3.7

Taiwan, China 1.6 1.3 -0.3 5.4 4.0 -1.4

Thailand 5.5 5.1 -0.4 11.3 11.3 0.0

Tonga 4.0 4.0 0.0 11.3 10.9 -0.4

Viet Nam 2.9 3.2 0.3 8.4 11.0 2.6

World average 2.8 2.8 0.0 7.8 7.9 0.1

Notes: 1. Direct jobs, all activities in direct contact with visitors;

2. Direct and indirect jobs, including suppliers to the industry, government agencies,

manufacturing and construction of capital goods and exported goods in the travel and tourism

sector and supplied commodities.

Source: WTTC Country Reports , 2000 and 2008.

2. Characteristics and Trends

As the importance of tourism in economic, social and cultural developments is widely

acknowledged, governments around the world have paid particular attention to the

measurement of the sector’s contribution, in particular, employment and its

characteristics and trends. Apart from the WTTC which provides country profiles of

the TSA, other international organisations have conducted cross-country studies of

tourism employment and generated statistical reports for deliberation.




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The United Nations Statistical Division (2007) recommends countries to collect

certain key variables in order to analyse the pattern of employment in tourism

industries, such as employment by age group, sex, type of establishment, educational

attainment and hours of work. The Eurostat (2008) discusses the contribution made by

the tourism industry to the labour market in the European Union (EU27) and studies

the pattern of employment in the “horeca” sector (hotels, restaurants and catering) and

tourist accommodation in particular. It is found that the sectors employ a large number

of female workers, workers with low education qualifications and young workers with

age under 35, and offer a high proportion of temporary jobs.

The International Labour Organisation has created a committee for the HCT sector2

(hotel, catering and tourism) which studies its employment, working conditions and

recent developments. Its report on Human Resources Development, Employment and

Globalisation in the Hotel, Catering and Tourism Sector (2001) analyses the

employment pattern in the fields of remuneration, staff turnover, working hours and

employment effects of recent forms of tourism. Subsequently, the International

Labour Organisation (2003) describes the employment features of tourism in Asia and

the Pacific as low and unattractive industry image, female employees as the majority,

high mobility, and shortages in skill. Enterprises in the sector are characterised as

small and medium-sized businesses.

Basically, the features of tourism employment can be underlined from five

perspectives:

2.1 Accessibility

The TRIs tend to accommodate workers with a wide variety of skills though the level

of skill is not necessarily high. Their job qualifications are more social than technical

2 The HCT sector includes:a. hotels, boarding houses hotels, boarding houses, motels, tourist camps, holiday centres;b. restaurants, bars, cafeterias, snack bars, pubs, night clubs, and other similar establishments;c. establishments for the provision of meals and refreshments within the framework of industrial

and institutional catering (for hospitals, factory and office canteens, schools, aircraft, ships, etc.);d. travel agencies and tourist guides, tourism information offices;

e. conference and exhibition centres.




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in the sense that the employees should know how to deal with people, and it is hard

for them to develop standardisation techniques. In addition, customers are witnessed

to get involved in the management of employees in the TRIs (Rodriguez and

Turegano 2003).

Riley et al. (2002) argue that industries that are expanding will have a good reputation

in the marketplace and hence can attract labour from other industries, especially the

declining ones. If combined with low entry barriers, expanding industries would

facilitate a higher degree of accessibility by workers. Simeral (1998) therefore

concludes that tourism with these characteristics is a powerhouse to generate

employment. It has been witnessed as a major provider for jobs in most Organisation

for Economic Co-operation and Development (OECD) and developing countries.

2.2 Flexibility

The standard assumption of productivity analysis is expressed in terms of an

input-output model in which the level of inputs determines the level of outputs, which

then satisfies demand in the market. In the case of tourism, demand tends to be rather

volatile so that inputs for production such as labour would require a higher degree of

flexibility. Unlike other industries, tourism appears to be more sensitive to seasonal

and periodic variations in demand (Ball 1989). Koenig and Bischoff (2004) conclude

different categories of causes of tourism seasonality, including “natural”,

“institutionalised”, “sporting seasons”, “tradition”, “business customs” and “supply

side constraints”. It is also essential for the management to forecast accurately and

respond effectively to the uncertainty in demand (Riley et al. 2002).

On the other hand, part-time or flexible work could be suitable to women and students

(Mathieson and Wall 1982). As family caretakers, women are unavailable for

full-time jobs or can only be engaged in occupations with flexible working hours.

Seasonal jobs in tourism are also thought to attract people from the periphery of the

labour force. However, this creates a negative effect on job security, career prospects

and pay. The informality of labour relations is psychologically rooted in the imprecise

contracts that are implicit in tourism jobs (Baldacchino 1997). Average tenure,

defined as the average duration of the on-going employment relationships, is

relatively short in tourism.




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2.3 Remuneration and working condition

According to the International Labour Organisation (2003), the image of the tourism

sector, especially hospitality, is rather low and regarded as unattractive. Employment

in hotels and restaurants is regarded as low-pay, unsocial hours, shift work, working

over holiday periods, and sometimes as working away from home in remote resort.

Many workers in the sector are said to be physically isolated and work in unsocial

hours, separate from normal exposure to the general public. However, there are

non-material benefits like accommodation, tips, training, convenience in working

hours that attract or retain employees.

On the other hand, Lanza and Pigliaru (1999) state that economies specialised in

tourism are usually small and they tend to grow faster than others on average.

Countries specialised in tourism have experienced a per capita income growth of

about 5% per year during 1985-1994, while the average growth rate at the world level

was just 0.8%. Brau et al. (2007) compare the income level and the index of tourism

specialisation (i.e. the ratio of international tourist receipts to GDP) in 29 small

countries. They conclude that tourism is generally associated with higher-than-

average income especially in small and island countries. In other words, tourism

workers in small economies would benefit from a higher level of income.

2.4 Mobility

Riley et al. (2002) classify different types of mobility, including job mobility,

occupation mobility, inter-industry mobility and geographical mobility. In which,

geographical mobility also covers importation of foreign workers, both skilled and

unskilled.

Acquisition of job-specific and industry-specific skills would undermine the

probability of job mobility. Becker (1975) therefore argues that tourism workers,

generally equipped with relatively low and generalised skills, would be more readily

transferable.




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2.5 Enterprise size

The International Labour Organisation (2003) argues that the tourism sector consists

of a large portion of small and medium-sized enterprises (SMEs). SMEs are more

flexible, closer to the customers and less capital-intensive.

Saayman and Slabbert (2001) study the opportunities and threats of tourism

entrepreneurs in South Africa. They illustrate certain business obstacles facing the

SMEs, namely (a) the problem in financing, not only the shortage of funds, but

including the lack of knowledge to approach financial institutions and access to

foreign funding; (b) tourism regarded as a risky industry by financial institutions; (c)

inexperienced entrepreneurs and lack of management skills and knowledge, and lastly

(d) lack of marketing skills.

3. Tourism Employment in Macao

Industries in Macao are classified according to the Classification of Economic

Activities of Macao – Revision 1 (1997).3 Considering the international practice and

data availability in Macao, the TRIs listed in Table 2 are examined in this paper.

As shown in Table 3, the proportion of TRIs to total employment climbed from 39.9%

in 2000 to over half in 2008 – a sharp increase of 11.3 percentage points in eight years.

Since 2003, after the gaming liberalisation and the implementation of the Individual

Traveller Scheme (ITS), the tourism industry has taken off while its share in

employed population has risen gradually. Among the TRIs, “gaming” and “hotel”

saw the largest gains. The former rose significantly by 13.9 percentage points, while

the latter increased by 2.0 percentage points. The TRIs are now the largest employer

in Macao.

3 The Classification of Economic Activities of Macao – Revision 1 (CAM Rev.1) is compiled based on

the International Standard Industrial Classification (ISIC Rev.3) of the United Nations.




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Table 2: TRIs in Macao under Study

Code Description

G Wholesale and retail trade

52

Retail trade, except of motor vehicles, motorcycles and automotive

fuel; repair of personal and household goods (Retail trade)

H Hotels, restaurants and similar activities

551 Hotels and similar activities (Hotel)

522 Restaurants, bars, canteens and similar activities (Catering)

I Transport, storage and communications (Transport)

O Other community, social and personal services

92491 Gaming

O except

92491

Other community, social and personal services, except gaming

(Other services)

Source: Statistics and Census Service (DSEC).

Table 3: Shares of TRIs in Employed Population, 2000-2008

Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008

Hotel 2.9 3.0 2.7 3.1 2.9 2.9 3.6 4.0 4.8

Catering 7.9 8.0 8.8 7.8 8.1 7.6 7.7 7.6 8.0

Retail trade 10.5 10.1 10.4 11.1 11.0 10.3 9.4 8.9 9.0

Transport 7.5 7.2 6.4 7.0 6.8 6.2 6.3 5.5 5.0

Gaming 6.7 7.1 6.9 7.5 10.5 13.0 16.1 19.5 20.6

Other services 4.3 3.8 4.6 4.1 3.8 4.2 3.7 3.5 3.8

Sub-total 39.9 39.3 39.8 40.7 43.1 44.2 46.9 49.0 51.2

Unit: Share in %.

Source: DSEC.

Based on the framework presented in the previous section, we analyse employment

characteristics in Macao’s TRIs from different perspectives and related indicators as

shown in Chart 1.




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Chart 1: Perspectives of TRIs Employment and Related Indicators

3.1 Accessibility

Accessibility can be represented by educational attainment, number of vacancies, age

groups and recruitment prerequisites.

As shown in Table 4, the majority of employees of the TRIs in Macao attain junior

secondary level of education, agreeable to the pattern of education attainment for the

whole employment population. During 2000-08 on average, the tourism sector

accommodated a larger proportion of employees with lower education attainment,

including primary (+2.2ppts), junior secondary (+1.8ppts) and senior secondary

(+1.8ppts), than all sectors. It would be due to its employment of a large number of

junior staff like waiters and housekeepers to keep the expanding daily operations.

The proportion of employees with tertiary education in the TRIs (9.8%) was 6.0

percentage points lower than that of the overall employment. However, the

proportion of employees in the TRIs with tertiary education rose from 7.3% in 2000 to

16.0% in 2008. The growth is 0.3 percentage points higher than the growth of

all-sector employment, indicating a rise in recruiting requirement.




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Table 4: Employed Population by Educational Attainment, 2000-2008

Educational

Attainment 2000 2001 2002 2003 2004 2005 2006 2007 2008 average

Subtotal of TRI*

No schooling/ pre-primary

11.0 11.3 10.2 11.0 10.3 7.7 6.1 5.2 4.3 8.6

Primary 31.0 30.0 30.3 27.8 25.8 24.3 22.5 21.5 17.2 25.6

Junior secondary 34.1 33.4 33.0 33.3 32.8 33.1 34.5 33.7 32.5 33.4

Senior secondary 16.7 17.9 18.7 18.9 21.9 25.0 26.4 27.5 30.2 22.6

Tertiary 7.3 7.3 7.7 9.0 9.0 9.9 10.5 12.0 16.0 9.8

Overall

No schooling/

pre-primary10.4 10.4 9.8 10.0 9.8 7.8 6.3 6.0 4.6 8.4

Primary 27.2 27.7 26.1 24.8 23.7 22.4 21.5 20.1 16.8 23.4

Junior secondary 33.1 32.5 32.8 31.9 30.9 31.6 31.5 30.3 30.1 31.6

Senior secondary 16.6 17.0 17.8 17.7 20.0 22.4 23.8 24.4 27.5 20.8

Tertiary 12.6 12.3 13.6 15.6 15.5 15.7 16.9 19.2 21.0 15.8

Unit: Proportion in %.

Note:*Including retail trade, hotel, catering, transport, gaming and other services.

Source: DSEC.

During the period under review, the top-three industries with the largest number of

vacancies were “manufacturing”, “gaming” and “catering” (Table 5). Under the

influence of the economic downturn amid the financial tsunami, the number of

vacancies of all industries dropped in 2008.

Table 5: Number of Vacancies by Industry, 2000-2008

Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008

Manufacturing1 7,034 5,352 3,399 4,637 6,704 6,483 6,710 4,780 3,030

Electricity, gas &

water supply1 3 14 10 8 8 37 12 28 22

Hotel1 421 289 251 233 411 596 1,539 2,966 1,954

Catering1 208 236 179 267 1,221 2,165 3,286 3,515 2,571

Financial

intermediation1

27 33 48 55 103 127 185 251 260

Retail trade 2 87 63 150 275 800 1,377 2,117 2,433 1,485

Transport2 230 191 157 216 608 556 791 1,172 612

Investigation &

security activities2,3 826 1,071 963 481

Public sewage &

refuse disposal2,3 3 14 10 23

Gaming2,4 6,015 9,607 5,665 4,262 511

Notes:1. Data released in first and third quarters on a regular basis; annual figures are averages of the two

quarters.2. Data released in second and fourth quarters on a regular basis; annual figures are averages of the

two quarters.3. Data available since the fourth quarter of 2005.

4. Data available since 2004.Source: DSEC.




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The TRIs, except “gaming”, were on the upward trend in the years to 2007. “Retail

trade”, “catering”, “hotel” and “transport” all showed above-average increments in

vacancies from 2000 to 2007. Accompanying with the establishment of the

complexes of hotels, casinos and catering services, the sectors saw a significant

growth in job vacancies. The job opportunities, coupled with better remuneration

packages, attract labour from other industries, especially from the declining ones.

As shown in Table 6, most of the employees fell in the “35-44” age group in both the

TRIs and all industries. The TRIs employed a larger proportion of young workers

(aged 14-24) than all industries. Especially in “gaming” and “other services”, the

portion of young employees continued to grow during the observed years.

Table 6: Employed Population by Age Group, 2000-2008

Age Group 2000 2001 2002 2003 2004 2005 2006 2007 2008

Subtotal of

TRIs*

14-24 12.9 13.2 12.5 12.1 14.0 17.0 17.5 19.5 18.5

25-34 26.9 24.4 24.2 24.1 22.8 22.7 22.3 24.0 24.5

35-44 35.4 33.1 32.8 31.2 30.3 28.1 27.6 25.7 25.4

45-54 19.0 22.2 23.2 24.3 25.0 23.9 24.5 22.9 22.8

55-64 4.3 5.1 5.6 6.5 6.4 6.7 7.0 6.9 7.7

>=65 1.4 2.0 1.8 1.7 1.6 1.5 1.3 1.0 1.0

Overall

14-24 11.8 12.1 11.2 10.6 11.0 12.2 12.8 13.7 13.4

25-34 27.8 26.5 25.7 25.3 24.3 24.2 23.9 24.0 24.7

35-44 35.0 33.1 32.6 31.3 29.9 28.7 28.1 27.3 26.8

45-54 19.6 21.3 22.9 24.6 25.6 25.6 25.6 25.2 24.9

55-64 4.6 5.1 6.1 6.7 7.6 7.9 8.3 8.6 9.0

>=65 1.2 1.8 1.5 1.4 1.6 1.3 1.3 1.2 1.3


Note: *Including retail trade, hotel, catering, transport, gaming and other services. Source: DSEC.

In terms of recruitment prerequisites, requirements of the TRIs for experience,

qualification and academic achievements seemed to be relatively low (Table 7).

“Transport, storage and communications” largely recruited staff with primary

education. For “wholesale and retail trade”, “gaming – services and sales workers”

and “hotels and restaurants”, mainly staff of junior secondary education were required.

For “gaming – clerks”, recruitment prerequisite for educational attainment was senior

secondary. In comparison, “public sewage and refuse disposal activities”,“electricity, gas and water supply” and “financial intermediation” normally required




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staff with tertiary education. In TRIs, as staff needs to serve directly the customers,

physical appearance and language skills are essential requirements for recruitment.

Table 7: Percentage Distribution of Recruitment Prerequisites, 2004-2008

Prerequisites ManufacturingElectricity, gas &

water supplyHotels & restaurants

Financial

Intermediation

Wholesale & retail

trade

Professional Experience

Yes 78.9 66.3 48.6 59.3 60.0

No 21.1 33.7 51.4 40.7 40.0

Professional Qualification

Yes 2.7 19.1 4.2 17.6 13.2

No 97.3 81.0 95.8 82.5 86.8

Academic Achievement

Primary 41.7 3.1 28.7 0.1 25.1

Junior Secondary 26.8 6.8 36.2 2.6 38.0

Senior Secondary 5.1 43.5 21.3 44.3 20.6

Tertiary 3.1 45.5 4.8 48.9 9.5

No preference 23.4 1.2 20.5 4.0 7.4

Language Skills

Mandarin 28.5 18.1 42.1 74.7 52.0

English 6.2 85.4 32.8 87.1 32.8

Prerequisites

Transport,

Storage &

Communications

Security activities

Public sewage &

refuse disposal

activities

Gaming - ClerksGaming - Services

and sales workers

Professional Experience

Yes 38.3 10.9 87.9 23.3 35.1

No 61.7 89.1 12.1 76.7 64.9

Professional Qualification

Yes 56.4 3.0 49.4 6.6 0.7

No 43.6 97.0 50.6 93.4 99.3

Academic Achievement

Primary 24.7 89.6 2.4 0.5 2.3

Junior Secondary 15.2 5.8 9.3 13.7 75.0

Senior Secondary 15.1 0.6 40.0 73.6 16.4

Tertiary 17.0 3.4 43.5 12.1 0.1

No preference 37.6 0.0 0.0 0.2 8.6

Language Skills

Mandarin 23.3 20.0 30.2 84.9 80.5

English 33.8 30.9 45.5 85.4 18.5

Source: DSEC.

3.2 Flexibility

The need for employment flexibility in the TRIs comes from the volatility of tourism

demand. In the case of Macao, the number of tourists appears to be quite stable

throughout the year. Seasonality seems minor, though long holidays in neighbouring




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regions like Lunar New Year, Christmas, Labour Day and other special events in

Macao such as Grand Prix would have some impact on visitor arrivals. As shown in

Chart 2, visitor arrivals were quite even for the four quarters though the second

quarter could be viewed as a “low” season. In addition, deliberate policy measures,

such as the ITS, were influential to arrivals.

On the other hand, the TRIs in Macao do exhibit employment flexibility with a

relatively high proportion of part-time workers. Table 8 shows the percentage of

part-time employees of different industries in Macao during 2000-08. The industries

with the highest proportion of part-time employees were “catering” and “retail trade”.

The third place had shifted from “manufacturing” to other TRIs of “gaming” and

“hotels” since 2003.

Chart 2: Visitor Arrivals, 2000-2008

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2000 2001 2002 2003 2004 2005 2006 2007 2008

N o .

( ' 0 0 0 )

Note: Visitor arrivals and other non-residents for 2000 to 2007 and visitor arrivals separately

available only for 2008.

Source: DSEC.

Aside from “gaming”, the TRIs had maintained an upward trend for proportion of

part-time employees until 2008. The high proportion might also reflect the situation

of labour shortage during the period when business expanded at a fast pace.Compared with other TRIs, gaming provides a whole set of training facilities and




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well-developed employment standards. Hence, part-time work does not dominate in

the industry.

Table 8: Part-time Employees by Industry, 2000-2008

Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008

Manufacturing1 4.9 4.5 5.9 5.2 5.1 3.7 4.1 2.9 3.8

Electricity, gas & water

supply1 2.2 2.7 3.2 3.8 2.1 0.1 0.3 0.5 0.1

Hotel1 1.1 1.6 3.3 6.4 5.8 5.8 4.9 8.6 7.3

Catering1 7.4 8.2 9.2 10.7 13.2 13.5 17.7 18.9 12.4

Financial intermediation1 0.4 0.4 0.4 0.5 0.7 1.0 1.4 2.5 2.4

Retail trade 2 6.8 8.3 8.4 7.5 10.0 12.1 12.9 13.9 12.0

Transport2 3.8 3.0 3.5 4.0 5.0 4.3 4.0 5.3 4.1

Investigation & security

activities2,3 0.9 0.9 1.6 0.4

Public sewage & refuse

disposal2,3

0.0 0.0 0.0 0.0

Gaming2,4

7.4 6.1 5.6 2.9 2.6

Unit: Proportion in %. Notes:1. Data released in first and third quarters on a regular basis; annual figures are averages of the two

quarters.2. Data released in second and fourth quarters on a regular basis; annual figures are averages of the

two quarters.3. Data available since the fourth quarter of 2005.4. Data available since 2004.Source: DSEC.

3.3 Remuneration and working condition

As shown in Chart 3, the income levels of different TRIs were varied during 2000-08.

The income levels of “recreational, cultural, gaming and other services” and

“transport, storage and communications” employees were higher than the overall

median. Meanwhile, employee incomes in “hotels, restaurants and similar activities”

and “wholesale, retail trade and similar activities” were comparatively low. On the

other hand, the growth rate of the overall median was 33.5% between 2000 and 2008,

while the rate for “recreational, cultural, gaming and other services” was much higher

(43.4%). However, the growth rates for other TRIs, including “wholesale, retail

trade and similar activities” (28.5%), “transport, storage and communications” (26.6%)

and “hotels, restaurants and similar activities” (25.8%), were apparently lower.




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Chart 3: Inflation-adjusted Median Monthly Earnings of Employees, 2000-2008

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

11,000

12,000

2000 2001 2002 2003 2004 2005 2006 2007 2008

( M O P )

Hotels, restaurants & simila r act ivities Wholesa le, retail trade & simila r act iv it ies

Transport , sto rage & communica tions Recrea tiona l, cu ltura l, gaming & other serv ices

Overall median

Note: Data are adjusted with the composite consumer price index.

Source: Underlying data from DSEC.

Table 9: Median Weekly Working Hours of Employees by Industry, 2001-2008

Source: DSEC.

Other than pay, the number of working hours reflects the working condition of

employees. According to Table 9, the median weekly working hours of employees for

all TRIs were over the average median of all employees, with the highest observed in

the “hotels, restaurants and similar activities” industry. On the other hand, the

difference between median hours of the TRIs and all sectors contracted from 5.3 hours

Industry 2001 2002 2003 2004 2005 2006 2007 2008

Hotels, restaurants & similar

activities 57.9 55.5 53.0 54.0 51.4 49.8 48.7 48.1

Wholesale, retail trade &

similar activities 53.4 52.9 52.0 54.1 49.3 48.9 48.8 48.6

Transport, storage &

communications 47.4 47.0 47.0 47.6 47.2 47.0 47.1 46.7

Other community, social &

personal services 55.0 53.9 52.2 53.3 49.1 47.4 47.0 46.9

Average 53.4 52.3 51.1 52.3 49.3 48.3 47.9 47.6

Overall 48.1 47.8 47.3 48.0 47.5 47.1 46.9 46.9

Difference 5.3 4.5 3.8 4.3 1.7 1.2 1.0 0.7




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in 2000 to less than one hour in 2008, showing a relative improvement in working

condition for the TRIs.

3.4 Mobility

According to the Labour Mobility Survey 2006 and 2007 conducted by the DSEC,

most of the job-changers had worked previously in the TRIs, such as “hotels,

restaurants and similar activities” (24.1% in 2006 and 20.0% in 2007), “recreation,

cultural, gaming and other services” (16.3% and 20.4%) and “wholesale and retail

trade” (18.0% and 18.1%). Subsequently, most of them would join the above three

industries with respective proportions of 17.6%, 34.5% and 12.5% in 2006 and 17.5%,

40.8% and 9.7% in 2007.

In 2008, the DSEC carried out the survey of job-changing of employed persons,

creating a more precise picture of job-changers in the TRIs. As presented in Table

10, workers of the TRIs showed the highest mobility in Macao. As the inflow of

labour was larger than its outflow, the TRIs could absorb more workers, from the

same industry or other industries, which also substantiated the high accessibility of

TRI employment at the same time.

Table 10: Employee Mobility of Selected Industries, 2008

Employee Mobility

Recreation,

Cultural, Gaming &

Other Services

Hotels, Restaurants

& Similar Activities

Whole & Retail

Trade

No. (% share) No. (% share) No. (% share)

Inflow 16,200 8,000 4,300

Cross-industry 8,200 (50.6) 3,600 (45.0) 2,400 (55.8)

Intra-industry 8,000 (49.4) 4,400 (55.0) 1,900 (44.2)

Outflow 2,400 4,100 4,800

Source: DSEC.

On geographical mobility, the Macao Government started to approve importation of

labour in 1988. Concurrently, the importation is applied to skilled workers (Dispatch

No. 49/GM/88), unskilled workers (Dispatch No. 12/GM/88) and “non-residents

exercising activities of direct personal gains” (Administrative Regulation No.

17/2004).




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The proportion of non-resident workers in the TRIs to total non-resident workers rose

from around 20% in 2000 to over 50% in 2007, but retreated to 45.9% in 2008 (Table

11). Among the TRIs, “hotels” and “recreational, cultural, gaming and other

services” were the two industries which employed the largest proportion of

non-resident workers, with their shares rising significantly in 2005 and 2006.

Hotels and gaming enterprises, especially the foreign ones, imported skilled foreign

workers to play the managerial and training roles and specialists of different fields,

like performers, artists and chefs of special cuisines, who could not be found in

Macao. In addition, they also needed a large quantity of unskilled non-resident

workers to maintain their large-scale operations. The SMEs in “restaurants, bars,

canteens and similar activities” and “wholesale and retail trade” largely imported

unskilled workers to cope with the increased workload brought about by the fast

growth of tourists and also to supplement local workers who had left for better

remuneration in large companies.

Table 11: Shares of Non-resident Workers in the TRIs, 2000-2008

Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008

Hotels 7.9 6.8 6.4 7.2 6.9 8.4 7.1 8.9 11.5

Restaurants, bars, canteens& similar activities

2.7 2.5 2.6 3.0 3.1 4.3 4.6 6.0 8.1

Wholesale & retail trade 5.4 4.3 4.5 0.7 1.0 1.6 2.3 4.3 7.6

Transport, storage &

communications1.7 2.1 2.3 4.1 1.9 1.7 1.8 2.1 2.7

Recreational, cultural,

gaming & other services6.9 8.1 9.1 7.2 10.3 15.1 32.1 29.7 16.0

Subtotal of TRIs 24.6 22.6 24.8 22.2 23.2 31.2 47.9 51.0 45.9

Unit: % share.Source: DSEC.

The drop in the number of non-resident workers in 2008 was in line with the financial

tsunami, slower growth of tourism and the rise in the unemployment rate. In view of

the deteriorated economic environment, the MSAR Government implemented

measures in restricting the importation and quotas of non-resident workers.

3.5 Enterprise size

As shown in Table 12, which presents data of 2000-08, there were variations among




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different TRIs. For “retail trade” and “catering”, over half of the employees worked

in small establishments with total number of staff below 30.

For gaming, however, almost 90% of the paid employees worked in establishments

with more than 2,000 staff. For the hotel industry, in the years 2000 to 2005, about

50% of its employees were working in establishments with 200-499 staff, while in the

years 2007 and 2008, over 70% of them worked in establishments with staff of over

500.

In 2002, the MSAR Government ended the monopoly in gaming. With the strong

growth of tourism, there has been a significant increase in foreign direct investment.

International hotel and casino groups have invested massively in building large hotel

and gaming facilities, which have eventually demanded for a huge number of

workers.

Therefore, the TRIs can be divided into two streams. First, the large foreign

enterprises in the gaming and hotel sectors employ a huge number of workers. They

introduce their management attitudes and system to their Macao establishments,

providing employees with better working conditions, accompanied by higher wages,

as well as an improved benefit and compensation system. They also import a

significant number of foreign workers for their expanding operations. In order to

fulfill their international service standards and with attractive terms provided, they

usually require their employees to have a higher educational attainment (probably

above secondary level) and better language skills, and provide training programmes

for improvement in staff quality.

Second, in “catering”, “retail trade” and other similar activities, SMEs, of which,

some are family-owned shops, prevail in the market. The labour contracts they offer

are usually informal and short-term. Working conditions are less favourable, usually

with longer working hours, lower wages and limited training and benefits provided.

In other words, the development of gaming and related activities in the past few years

has appeared to improve the average employment condition in the TRIs.




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Table 12: Employees by Size of Establishment in Selected Industries, 2000-2008

Industry/ Size of

establishment

(No. of workers) 2000 2001 2002 2003 2004 2005 2006 2007 2008 Avg.

Hotel

<30 2.5 1.9 1.5 1.6 1.6 1.5 1.1 0.8 0.5 1.130-49 2.3 2.7 3.6 2.9 2.3 1.8 2.2 0.8 0.6 1.6

50-99 2.6 2.2 1.1 1.5 1.9 1.7 1.4 0.7 1.1 1.3

100-199 8.8 12.0 16.3 13.2 12.2 13.7 9.6 6.7 3.5 8.4

200-499 58.6 56.7 52.3 53.8 56.7 48.2 36.9 19.4 14.7 33.3

>=500 25.2 24.4 25.2 27.0 25.3 33.1 48.9 71.6 79.7 54.3

Catering

<30 53.6 53.9 54.8 56.9 56.7 55.9 51.5 52.1 49.9 53.6

30-49 11.3 10.7 10.7 11.1 10.6 9.3 8.8 8.8 7.5 9.6

50-99 16.0 16.9 17.7 16.2 17.5 18.1 18.7 16.1 16.0 17.0

100-199 13.9 11.9 11.9 11.7 9.1 10.4 10.5 11.3 13.3 11.6

200-499 5.2 6.6 4.9 4.1 3.9 1.7 1.2 2.8 7.2 4.2>=500 0.0 0.0 0.0 0.0 2.3 4.7 9.2 8.9 6.0 4.0

Retail trade

<30 82.3 82.5 81.4 79.3 75.4 73.9 70.4 67.3 66.3 73.9

30-49 2.9 3.8 4.0 4.3 6.1 4.9 5.3 4.9 5.4 4.8

50-99 5.9 4.9 4.7 4.4 5.4 4.3 4.7 6.8 8.6 5.8

100-199 3.1 2.4 3.7 4.9 4.6 7.5 8.1 5.5 4.7 5.2

200-499 5.9 6.4 6.1 7.1 2.7 3.7 5.9 9.8 10.2 6.7

>=500 0.0 0.0 0.0 0.0 5.8 5.7 5.7 5.7 4.7 3.6

Transport

<30 21.6 21.5 23.0 22.6 23.1 19.3 20.5 23.5 23.4 22.1

30-49 3.4 3.5 3.8 6.1 6.7 5.7 7.8 5.9 6.0 5.4

50-99 7.1 6.5 5.1 3.1 5.3 4.3 6.6 7.7 8.8 6.0

100-199 4.9 4.5 6.6 10.6 10.5 9.3 8.1 10.0 10.7 8.3

200-499 24.4 22.8 16.7 14.3 12.1 14.3 13.6 12.2 12.4 15.9

>=500 38.4 41.2 44.8 43.3 42.4 47.2 43.5 40.8 38.6 42.2

Gaming*

<100 0.4 0.4 0.4 0.2 0.1 0.3

100-299 1.2 0.5 0.2 0.0 0.0 0.3

300-499 2.2 3.2 2.4 2.7 2.2 2.5

500-999 3.2 2.7 1.7 0.6 1.9 1.8

1000-1999 6.0 6.8 5.5 3.8 3.7 4.8

>=2000 86.9 86.3 89.8 93.0 92.1 90.4


Note: *Data available since 2004.

Source: DSEC.

4. Conclusion

This paper discusses employment characteristics and trends of TRIs with application

to Macao from five perspectives – accessibility, flexibility, remuneration and workingcondition, mobility and enterprise size.




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The TRIs in Macao present a relatively high accessibility of employment in terms of

educational attainment, age, number of vacancies and recruitment prerequisites.

This feature is conducive to absorbing displaced workers from “sunset” industries,

and hence helps tackle the problem of structural unemployment in Macao.4

While demand for tourism services is relatively stable in Macao, employment in the

TRIs, especially in non-gaming TRIs, still evinces flexibility with a comparatively

high proportion of part-time workers. Meanwhile, the high mobility of tourism

employment, represented by the high staff turnover and a larger proportion of

non-resident workers, also enhances employment flexibility. As high flexibility is a

feature and merit of tourism employment, a proper regulatory system for employment

of temporary or part-time workers would encourage local residents to join the

workforce, eventually lifting the labour force participation rate and helping to relieve

the labour shortage problem in Macao.

It is also found that the working condition of employees in the TRIs has generally

improved, attributable to the development in the gaming and hotel industries with new

entries of large foreign corporations. Improvements have been witnessed in income,

benefit and working hours, though some TRIs such as restaurants, retail and similar

activities are still lagged behind in this employment aspect. In addition, major

tourism industries in Macao, including gaming and hotel, are currently dominated by

large enterprises, which appear to be able to provide better working conditions, terms

and training opportunities for workers.

Tourism is a leading economic sector in Macao, and TRIs are the largest employer in

the SAR. In view of its high degree of economic significance, it is hoped that this

paper, which highlights the characteristics and trends of tourism employment, can

provide some useful insights and an analytic reference for relevant policy and

business planning.

4 For a detailed analysis of structural unemployment in Macao, see Chan (2003).





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Documents

Employment Characteristics and Trends of Tourist Related Industries - Macao