TL;DR: Hong Kong is facing a profound structural challenge in its job market, a trend often mistakenly blamed on the education system itself. The reality is that decades of bottom-up societal pressure for university degrees have created a workforce misaligned with the economy's actual needs. This "Great Skills Mismatch" is not a temporary issue but a long-term reality that requires a fundamental shift in how we think about talent, education, and career paths.
I am James, CEO of Mercury Technology Solutions.
A very sharp question was recently posed to me, one that cuts to the heart of the anxiety many feel about Hong Kong's future. Paraphrasing a reader's concern, it boils down to this: after decades of enduring a high-pressure, exam-oriented education system, why are so many of our brightest university graduates, skilled in advanced mathematics and complex theories, finding themselves in roles that don't utilize their training—delivering food, handing out flyers, or working in commission-based sales? If this is the outcome, what was the purpose of the intense struggle?
This is not a simple question, and it deserves an honest, strategic analysis. The uncomfortable truth is that the pressure in our education system was never a top-down mandate. It has always been a bottom-up phenomenon, driven by the rational aspirations of previous generations.
The Origin of the "Degree Arms Race"
To understand our current situation, we must look at the historical context. In the post-war era, a university degree was not always seen as the ultimate prize. My father's generation, for example, saw more value and stability in other paths. It was only after the first wave of university graduates in the 70s and 80s reaped enormous benefits—rising quickly through the ranks in a rapidly expanding economy—that a powerful societal consensus began to form.
By the 1990s, the idea that a university degree was the definitive path to a better life was firmly entrenched. Parents, seeing the success of the first generation, naturally wanted the same for their children. This created a massive, bottom-up demand for exam success. It wasn't school administrators who created the high-pressure environment; it was parents, voting with their feet and their wallets, demanding better academic results and pushing schools into a competitive "arms race."
This was the second stage. And now, we are living in the third.
The Structural Mismatch: A Generational Bottleneck
The educational dividend that was so powerful for previous generations has now significantly diminished. However, the competitive pressure remains. We are now in a situation where everyone is in the race, not because the prize is so great, but because the perceived cost of not running is too high.
This has created a profound structural problem in our job market. Let's look at the simple math. A person born in 1965, retiring at 60 in 2025, entered the workforce around 1985. At that time, Hong Kong's economy was dominated by manufacturing and other blue-collar roles. The positions they are now vacating are, for the most part, not white-collar graduate jobs.
Conversely, a person born in 2000, entering the workforce today at 25, is part of a generation with an incredibly high rate of university education.
Herein lies the Great Skills Mismatch: the supply of highly-educated, white-collar talent is massive, while the replacement demand from retiring generations is for a different type of role entirely. This creates a supply-demand imbalance that no amount of economic growth can quickly absorb. This structural bottleneck is likely to persist for at least the next decade.
The Psychological Toll and the American Parallel
This mismatch is not just an economic issue; it takes a psychological toll. When a family invests heavily in a university education, only for their child to earn less than a skilled technician, it creates a sense of disillusionment.
Yet, the social pressure to get a degree remains immense. Why? Because it has become a matter of social standing. Parents think, "Everyone else's child has a degree; how can mine not?" This is the stage where the competition becomes about pride, not just profit.
This is a phase that other developed economies have already passed through. In the United States, for example, the market has reached a more stable equilibrium. It is a well-understood fact that while the lifetime earnings of a university graduate are higher, a skilled blue-collar worker will often have a higher net income until their late 40s, after accounting for the high cost of tuition. Faced with this data, many American families rationally choose the path of vocational training, leading to what is often mislabeled as a preference for "happy education." It is not about happiness; it is a market-driven choice.
Hong Kong has not yet reached this equilibrium. We are still in the phase where we are competing on social expectations.
The Strategic Path Forward: Redefining the Main Quest
As a business leader, my concern is not with societal consensus, which is beyond the control of any single individual. My focus is on the strategic path forward.
We cannot get so caught up in the "side quest" of winning the degree arms race that we forget the "main quest": building a successful and sustainable career.
The skills that are taught in university and the skills that are required to thrive in the modern economy are not mutually exclusive. An adult's career strategy must encompass both. While you navigate the societal pressure to get a degree, you must simultaneously focus on building the practical, real-world skills that the market is actually demanding.
The challenge for Hong Kong's next generation is to see beyond the traditional definitions of success. It is about understanding that in this new economy, a plumber who masters their trade and builds a successful business may create more value—and earn a better living—than a graduate with a degree that is not in demand.
The future belongs not to those who simply follow the old map, but to those who can read the new landscape and adapt their journey accordingly.
