16 APR, 2021

The Potential Impacts of COVID-19 School Closures on Loss of Earnings: Estimations and Policy Recommendations for Hong Kong

Written by : CK Law, David Lai, Justin Chan

Owing to the COVID-19 pandemic, schools around the world have been suspended for a matter of months, or even about a year in the case of Hong Kong. Loss of schooling is likely to affect a student’s future income. According to a World Bank report published in June 2020, the average student in high-income countries would lose about US$34,021 over his/her lifetime.

 

Adopting the methodology used in the World Bank report, MWYO estimates the income loss to student in Hong Kong due to school closures under the COVID-19 pandemic. The total loss of lifetime earnings (present value) for Hong Kong is estimated to be HK$270.3 billion. As for each student, the number is around HK$329,000.

 

Disparities in access to resources may affect the effectiveness of online learning during school closure. Students from higher-income families may enjoy more educational and technological support during school closure. That may translate to unequal learning outcomes, and hence unequal income loss. MWYO estimates a student from a higher-income family to lose about HK$207,000 in lifetime earnings, while a student from a lower-income family would lose about HK$426,000.

 

Based on these estimates, MWYO suggests the following policy responses and directions to mitigate the negative impacts of the income loss due to school closures :

 

  1. Issue tutorial vouchers for lower-income families
  2. Maintain public services related to education which are otherwise suspended due to the COVID-pandemic
  3. Schools should assist students in making better use of government subsidies to assist online learning needs
  4. Better facilitate the application of education technology in schools. For more details, please refer to MWYO’s latest report on educational technology published in February 2021.
  5. Strengthen internship programmes for secondary school students. For more details, please refer to MWYO’s latest report on internships published in December 2020.