As of Sunday 14 June, when applications for the Hong Kong Government’s HK$81 billion Employment Support Scheme (ESS), closed, less than two-thirds of eligible businesses have applied for the salary relief for employees.
Out of 270,000 eligible employers, just under 169,000 have applied for the wage subsidy representing just 62% of companies able to claim the benefit.
It’s a figure that has surprised some in the government – falling well short of the estimate of 90%, as estimated by labour and welfare chief Law Chi-kwong.
However, almost 260,000 applications have been filed by the self-employed, around 45,000 higher than the government’s estimate. About 24,000 of the self-employed have already received a lump sum of HK$7500.
But with the Hong Kong unemployment rate just hitting a 15-year high of 5.9%, the ESS is a welcome relief for SMEs and the self-employed.
"We have disbursed a total of around HK$4.8 billion to the first batch of 25,500 employers, which is estimated to benefit more than 200,000 employees,” a bureau spokesman for Law was quoted as saying in The Standard.
“(A total of) 98% of the employers receiving wage subsidies are micro or small and medium-sized enterprises with fewer than 50 employees,” he added.
Larger companies – notably the major banks such as HSBC and airline Cathay Pacific – were among those that declined the ESS payout. Earlier this month, the Hong Kong government bought a 6.1% stake in Cathay Pacific to help bail it out due to the ongoing impact of COVID-19 on its business operations.
However a number of smaller lenders in Hong Kong have applied for the ESS scheme. Notable among these are Bank of East Asia – and its subsidiaries – which reportedly intends to set aside extra funds from the payout to bolster its talent pool and step up recruitment.
Bank of Communications, China Everbright Bank and Public Bank have also signed up for the ESS payment.
Also read: Hong Kong banks and airlines spurn ESS handout for employees
Under the ESS scheme, the Hong Kong government will pay up to half of the salaries of each of participating companies employees for six months, with the amount capped at HK$9000 per month.