Industry decentralization in Hong Kong : some trends and patterns

Abstract

The Hong Kong government has dedicated considerable resources to study and test the viability of office decentralization within the city since the 1980s, with objectives to achieve more sustainable industry spatial patterns and to relieve the Central Business District (CBD)from pressures created by high density of establishments and employment. Policies encouraging firm relocation from CBD areas to other office nodes have been implemented, and it was believed that the construction of new railway lines would facilitate such decentralization policies. In addition, a review of literature suggests that decentralization seems to be an inevitable trend in the evolution of a city. In particular, it was proposed by Smith & Selwood (1983) that decentralization could be industry-selective.

With this background, this research aims to examine whether industries in Hong Kong have actually exhibited decentralizing spatial patterns from the period 1995 to 2010and to compare trend of changes in spatial patterns among different industries. Four industries were selected as the target of study, which are (1) finance and insurance, (2) professionals services, (3) real estate, and (4) import/export, wholesale and retail trades. Their employment and establishment data at Tertiary Planning Unit (TPU) level were obtained from the Census and Statistics Department and processed.

Through the use of spatial tools, it was found that the real estate industry experienced most rapid trends of decentralization, both in establishment and employment. The other industries were less obviously decentralized; for the finance and insurance industry and the import/export, wholesale and retail industry, there even appeared indicators of stronger concentration in the study period. These findings provide strong support for future relocation policies to be industry-oriented. Another important finding is that for all industries in all study years, employment distribution tends to be more centralized than establishment distribution, which suggests that decentralizing people may be harder to achieve than decentralizing offices. It is thus envisaged that in the future, government policies regarding traffic management need to complement decentralization policies in order to alleviate transportation pressure in Hong Kong’s CBD area.