Nature of the sectors

    Manufacturing sector is regarded as secondary industry. It is activity where human change raw materials provided by nature and extracted by primary activities, into more uself products. Manufacturing involves the processing of a material in order to increase its value. Human skills are applied to materials taken from nature, or from other manufactures. There activities are therefore human directed. In Hong Kong, there are many kinds of manufacturing activities such as clothing and textile, construction works, electrical products and so on.

    Financing, insurance, real estate and business sector is in the tertiary and quaternary industries. These are concerned with the provision of services and tend to be located where services are required, that is ,they are market-oriented. Also they are concerned with the provision of information and expertise.
 

Number of people employed in the two sectors:

District/Sector	Hong Kong Island	Kowloon	New Territories
Manufacturing	34394 (15.85%)	106267 (48.98%)	76303 (35.17%)
Financing, insurance ,real estate and business	269089 (61.53%)	121304 (27.74%)	46906 (10.73%)

    In March 2001, The total no.of people engaged in Manufacturing sector is 216964 while Financing , insurance, real estate and business is about 437299.

    It is no surprising that the total number of people engaged in financing, insurance, real estate and business is more than manufacturing sector. Due to the shifting of factories to mainland China in the pas few years ,people employed in manufacturing activities has been decreased sharply. Contrast with the encouragement of development of tertiary industries by government and the trend of economic restructure, many business corporations has been developed in Hong Kong, thus , the number of people engaged in financing, insurance , real estate and business has been increasing steadily.
 

Distribution

    Both of the two sectors has uneven distribution of employment in Hong Kong. For manufacturing industry, most people engaged in Kowloon especially Kwun Tong. In Hong Kong island, most people engaged in Eastern district while there are only about 3700 people engaged in Wan Chai. Kwai Tsing has most of people engaged in New Territorie.

    Regarding financing, insurance, real estate and business, most of the people engaged in Hong Kong island, Central and Western district has almost 147000 people engaged in this sector. Yau Tsim Mong has the most people engaged in Kowloon in which it contains 5500 people. Most of the districts in New Territories have fewer people engaged in when compared with Hong Kong island and Kowloon.
 

Background

    In the early 1960s, when Hong Kong was at its take off stage in industrialization, most of the industrial establishments were located in Tai Kok Tsui, Shum Shu Po and along Castle Peak Road. Today an increasing number of large enterprises are found at the suburban industrial areas in Tai Po, Fo Tan, Tsing Yi, Ap Lai Chau and as far as Tuen Mun and Yuen Long. However, since 1980s, many employers began to shift their factories to mainland China especially in ShenZhen special economic zone. The main type of those shifted industries is clothing and textile. Why does it happen? Simply it is because the cost running factory is higher than ever before especially labour cost. Besides, high land rent also disencourages employers to maintain their factories in Hong Kong. With the great competition from other Asian countries such as Thailand, Philipphines, employers has to reduce their costs as much as possible, mainland China is undoubtedly a place for Hong Kong employers to develop their manufacturing activities. Those push and pull factors make the number of people engaged in manufacturing sector decreased.

    Also there is trend for industries to move from urban areas to suburbs. Push factors from city core such as high rent , traffic congestion let urban areas appear to be increasingly an unsuitable environment for manufacturing industries. Besides, government makes land at the suburbs available at low price to industries. The Industrial Corporation was founded in 1977 to develop and manage the Tai Po and Yuen Long industrial estates. The land was leased out for a period of up to 15 years at a fixed premium of HK$650 per m2, which was probably one-fourth of the current market price. Also, a considerable amount of population has been resettled from the city centre to new towns under the Ten Years Housing Scheme. Labour, in fact, joined the move to suburbs.

    Tertiary industry plays an important role in Hong Kong economy nowadays. With the economic restructure , fewer and fewer people engage in manufacturing industries while more and more people employ in tertiary industries. As we know, central and business districts (CBD) involves most of the business to develop there including Central, Wan Chai, Yau Tsim Mong, it is because of the historical reason, Hong Kong has been colony for over 150 years, districts around Victoria Harbour has been developed as main business areas. The view of Victoria Harbour and its surround buildings has been remarkable sites for people to visit from all over the world. In New Territories, most of the districts are designed for residential use such as North district, Shatin. Thus, the total number people engaged in finacing, insurance, real estate and business is fewer than Kowloon and Hong Kong island.