SINCE the financial tsunami hit Hong Kong, reports of layoffs have come one after the other. Yesterday, Cathay Pacific announced it would cut year-end bonuses but give its employees an average pay rise of 2%. It also said it had no plan to lay off any of its employees. That is comforting news to wage earners. Businesses may have to cut costs when the economy is in poor shape. However, it is not the only way of doing so to lay off employees. The service sector being the backbone of Hong Kong's economy, talent is of the essence. Businesses that stand by their employees when times are hard actually invest in their workforces. They would have better chances of achieving even greater successes when the economy recovers.



Recently many have become unemployed. The economic gusts are as chilly as the monsoon that has just arrived. Things are bad, and it is the government's biggest headache to find ways to create jobs. The clamour for starting infrastructure projects soon has been growing. Hong Kong being a free-market economy, employment depends mainly on the performance of the private sector. Happily, there are big Hong Kong businesses whose top managers have diligently racked their brains to find opportunities amid the crisis.



It is an effective way of cutting costs to lay off employees. The government has no power to prevent layoffs. However, as the service sector is the backbone of its economy, Hong Kong's capable people are its valuable assets. If workers live in constant fear of losing their jobs and always wonder what may become of them, their morale will plummet. How could they then provide good services?


Consumption has been low recently. Wage earners have first-hand experience of that. They have therefore sharply lowered their expectations. No unions would rashly organise strikes to press for pay rises. If a company vows not to cut jobs, its other cost-cutting measures would seem acceptable to its employees. Wage earners are not exactly at the mercy of their employers, but it is true that they have few bargaining counters. Society hopes businesses will refrain from using the recession as a pretext to shrink their payrolls. Cathay Pacific's is a solution which members of the public and its employees welcome.


In a commercial society, no businesses are charities. Corporate social responsibility is rarely businesses' top concern. However, Cathay Pacific has decided not to lay off any of its employees despite its earnings warning. The decision may not be in its best interests in the short term. It may even be bad news to investors and its shareholders. However, in the long term, it is not only conducive to Cathay Pacific's development but also in its shareholders' interests.



Opportunities may present themselves when business is slow. History tells us no economic difficulties are permanent. The current crisis has hit all economic powers in the world. All governments have gone all out to save the day. They cannot but sharply cut tax and interest rates and boost public spending. Some days ago, Taipei announced it would hand out money to encourage consumption. Some businesses have seized the opportunity to occupy favourable positions and increase their market shares with a view to bringing their advantages into play when the economy recovers. Businesses should take the long view. For a company to stand by its employees when times are hard is to invest in its workforce. Cathay Pacific has said it will not cut the number of its destinations or reduce its workforce. It may therefore reap substantial returns.



Amid waves of pay cuts and layoffs, calls are constantly heard for creating jobs. Businesses should take the long view in dealing with difficulties. If more companies make suitable investments, realising it is not the only way of cutting costs to lay off employees, unemployment will be less severe in the SAR.