The Death Of Social Mobility

On the face of it, Tin Shui Wai isn't the embodiment of urban blight. Stacked up against France's racially charged public-housing estates or America's crumbling inner-city ''projects," Hong Kong's newest satellite town looks remarkably accommodating. But the landscaped common areas, colorful residential blocks and playgrounds mask an undeniable fact: the community of 271,000, where scores of narrow towers cluster like bamboo shoots in a thicket soaring 40 stories skyward, is a ghetto. Local unemployment stands at 20 percent, some five times the Hong Kong average. The local schools are some of Hong Kong's worst, and many of the residents who do hold jobs are among the working poor, a class that's burgeoning. Tin Shui Wai signifies not only the social and economic challenges facing Hong Kong but also those gripping its developmental cohort, a group of economies once lauded as East Asia's ''four tigers." That moniker—pinned to Hong Kong, Singapore, South Korea and Taiwan back in the 1980s—hailed the trade-based economies that overcame resource shortages, widespread poverty and political turmoil to become industrialized, middle-class societies in a single generation. Along the way, their best and brightest rose from humble origins to become today's tycoons, top scholars and political leaders.

One needn't look farther than the various statehouses to view the beneficiaries of social mobility. Hong Kong's Chief Executive Donald Tsang grew up in public housing. Taiwanese President Chen Shui-bian, son of tenant farmers, graduated at the top of his class in law school. South Korean President Roh Moo Hyun was too poor to attend college but nonetheless passed the bar exam and practiced human-rights law. All three embody the boundless opportunities their fast-developing societies offered, though each rules during a time when the doors that were opened to them are shutting in the faces of today's youngsters. These current leaders ''come from a generation that had a fairly equal starting point; everyone was low-income and there was a level playing field," says John Sayer, head of Oxfam Hong Kong. ''Now we're getting more class divisions."

The tigers now are finding themselves in a situation loosely analogous to that which beset the American rust belt in the 1980s, when factory towns like Detroit and Pittsburgh went into decline and a middle class built on career manufacturing jobs suffered as a result. The tigers aren't rust belts, to be sure, but as the drivers of growth have shifted away from manufacturing into various new industries and services, it's no longer possible for young entrants into the labor market with little education and few skills to land jobs that pay living wages.

The new labor market is rigidly segmented: white-collar professionals occupy the top rungs of the ladder, a burgeoning service sector peopled by legions of temps and part-timers anchor the bottom, and the middle class clings nervously in between, even during periods of robust economic growth. ''As the tiger economies mature, they face economic polarization between the haves and have-nots," says Lee Jie Hoon, an economist at the Samsung Economic Research Institute in Seoul. ''Wealth inequality is like the shadow of economic growth."

In their prime, the tigers were voracious job creators. Although each followed a different growth strategy—South Korea built heavy industry, Taiwan mobilized small and medium enterprises, Singapore nurtured state-linked companies and Hong Kong embraced laissez-faire capitalism—all of them consumed a flood of surplus labor. Workers earned enough to feed their families, educate their kids, buy modest homes and even start businesses.

One of them was Koh Yun Yeol, a tireless 50-year-old whose most indelible childhood memory is hunger. Koh became a welder, worked his way through vocational school and, at the age of 21, landed a plum job at Hyundai Heavy Industries, the world's largest shipbuilder today. Three decades later Koh has attained the status of a ''steel maestro"—Hyundai's highest ranking for shipbuilders—and earns $70,000 a year. He sent his two sons to university, lives with his wife in a cozy apartment they own and even enjoyed a vacation to Europe at the company's expense in 2004. Koh, who faces mandatory retirement in eight years, isn't one bit worried. ''I have enough money to support me and my family," he says. ''I thank my company and my country for allowing me a wonderful life."