Hong Kong businesses operating in mainland China are adjusting to new legislation that gradually increases the retirement age, which could lead to higher manpower costs but also a more stable workforce. China’s top legislative body passed the law to extend the retirement age from 60 to 63 for male workers and from 55 to 58 for female white-collar employees. The changes will be phased in over the next 15 years.

This extension will impact all foreign-owned firms, including Hong Kong-based companies, with operations in mainland China. Danny Lau Tat-pong, honorary chairman of the Hong Kong Small and Medium Enterprises Association, said the impact on his building materials company would be minimal, as more than 10% of his 150-strong workforce are already over 60. Lau noted that employing older workers is cost-effective and beneficial for both the employees and the business.

Lau emphasized that the policy could be positive, allowing older workers to maintain an income and occupation, while companies benefit from their experience. His company operates in Dongguan, Guangdong, and has adapted well to the increasing age of its workforce.