January 23, 2023

The Census and Statistics Department (C&SD) released the results of the Quarterly Business Tendency Survey for the first quarter (Q1) of 2023.

Business situation

For all surveyed sectors taken together, the proportion of respondents expecting their business situation to be better (19%) in Q1 2023 over the preceding quarter is higher than that expecting it to be worse (13%).

When compared with the results of the Q4 2022 survey round, the proportion of respondents expecting a better business situation in Q1 2023 is 19%, higher than the corresponding proportion of 16% in Q4 2022. On the other hand, the proportion of respondents expecting a worse business situation has slightly increased from 12% in Q4 2022 to 13% in Q1 2023.

Analysed by sector, while the number of the surveyed sectors with respondents expecting their business situation to be better on balance in Q1 2023 as compared with Q4 2022 is the same as the number of surveyed sectors expecting a worse business situation, significantly more respondents in the accommodation and food services, financing and insurance and manufacturing sectors expect their business situation to be better in Q1 2023 as compared with Q4 2022.

The results of the survey should be interpreted with care. In this type of survey on expectations, the views collected in the survey are affected by the events in the community occurring around the time of enumeration, and it is difficult to establish precisely the extent to which respondents’ perception of the future accords with the underlying trends. The enumeration period for this survey round was from December 2, 2022 to January 9, 2023.

Volume of business/output

Respondents in most of the surveyed sectors expect their volume of business/output to increase on balance or remain broadly unchanged in Q1 2023 as compared with Q4 2022. In particular, significantly more respondents in the accommodation and food services, manufacturing and financing and insurance sectors expect their volume of business/production to increase in Q1 2023 over Q4 2022.

Employment

Respondents in all of the surveyed sectors expect their employment to remain broadly unchanged or increase on balance in Q1 2023 as compared with Q4 2022. In particular, more respondents in the accommodation and food services sector and the construction sector expect their employment to increase in Q1 2023 over Q4 2022.

Selling price/service charge

Respondents in most of the surveyed sectors expect their selling prices/service charges to increase on balance or remain broadly unchanged in Q1 2023 as compared with Q4 2022. In particular, significantly more respondents in the accommodation and food services sector expect their prices of food provided/charges for services rendered to go up in Q1 2023 over Q4 2022.

Commentary

A Government spokesman said that overall business sentiment among large enterprises improved slightly as compared to three months ago, though mixed performance was seen across different sectors. Large enterprises’ appetite for hiring stayed largely positive.

Looking forward, the spokesman pointed out that the removal of most local social distancing measures and the progressive resumption of normal travel between the Mainland and Hong Kong should provide support to business sentiment, though tightened financial conditions and the deteriorating global economic outlook will continue to bring uncertainties. The Government will monitor the situation closely.

Source: Hong Kong Census and Statistics Department
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