A survey released on Tuesday says that artificial intelligence-related skills, particularly in AI model applications, are considered the most in-demand talent by Hong Kong employers.

The survey published by ManpowerGroup, a workforce solutions provider, shows that one-quarter of companies reported challenges in hiring for these roles. “Market demand remains strong for talent capable of strategic judgment and AI mastery," said Lancy Chui, senior vice-president at ManpowerGroup.

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The survey revealed that Hong Kong’s Net Employment Outlook (NEO) for the first quarter of 2026 stands at 2 percent, a decline of 5 percentage points compared to the previous quarter. Among the sectors, the professional, scientific, and technical services recorded a negative outlook of -15 percent. A positive Net Employment Outlook indicates that more employers expect to hire than reduce their workforce.

Chui said that this sector is undergoing accelerated transformation driven by AI and automation. “The widespread adoption of AI has reduced demand for some entry-level roles, leading companies to moderate short-term hiring intentions,” she said.

In contrast, the services industry and manufacturing sector showed the most optimistic hiring prospects, with NEO of 13 percent and 12 percent, respectively. “The services sector is benefiting from sustained growth in visitor arrivals and increased cross-border travel, with the peak Lunar New Year travel season approaching in February, which is driving additional manpower needs across the hospitality and retail industries,” Chui added.

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The survey shows that 66 percent of the 506 employers surveyed expect recruitment difficulties due to talent shortages, a 15 percentage point drop from last year and the lowest level since 2015, though signs of easing are evident, talent shortages persist at a high level.

Thirty-one percent of employers anticipate increasing their workforce in the first quarter of 2026, 29 percent expect to reduce employees, and 37 percent forecast no change, revealing a positive but conservative hiring pace.

Chui said the global economy is showing signs of recovery, which could positively impact Hong Kong’s labor market if the local economy follows suit. She forecast that Hong Kong’s unemployment rate in 2026 will remain 3.7 to 3.9 percent, with average salary increases of around 2.7 percent.

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Hong Kong Census and Statistics Department released the latest unemployment and underemployment statistics on Tuesday, saying that the seasonally adjusted unemployment rate stood at 3.8 percent from September to November, the same as for August to October. The underemployment rate also remained unchanged at 1.6 percent for the two periods.

“The solid expansion of the Hong Kong economy and the improving consumer confidence should continue to render support to the overall labor market. Yet, the employment situations in some sectors may remain under pressure as their businesses face challenges,” said Secretary for Labour and Welfare, Chris Sun Yuk-han.

Contact the writer at akirawang@chinadailyhk.com