Hong Kong companies operating in mainland China say the increase in the retirement age could lead to higher personnel costs. However, companies can adapt to the gradual increase in the retirement age and benefit from a more stable workforce.

China’s top legislature passed legislation on Friday to gradually raise the retirement age from 60 to 63 for male workers and from 55 to 58 for female office workers. The extension will be phased in over 15 years.

All foreign companies, including those based in Hong Kong, will be affected by the plan as long as they have employees on the mainland.

Danny Lau Tat-pong, honorary chairman of the Hong Kong Small and Medium Enterprises Association, said he expected the change to have little impact on his building materials business as more than a tenth of its 150 employees were already over 60.

“Our operation doesn’t require sharp minds. Not only is it cheaper to hire older workers, they also earn an income and have a hobby. It’s good for them and good for us,” said Lau, who runs production facilities in Dongguan, Guangdong.