The Hong Kong government said it would raise the minimum wage by 7 per cent in May next year as it tries to allay concerns about a growing disparity between the rich and the poor in the city.

The lowest salaries will rise to HK$30 (US$3.90) an hour, the government said on Wednesday, affecting about 10 per cent of the city’s workforce – some 330,000 workers. The statutory minimum wage was put in place in May 2011, despite opposition from the business sector in the laisser-faire city.

The government headed by chief executive Chun-ying Leung, who assumed office in July, had signalled that it was willing to intervene more in the city’s economy, which has the highest income disparity in the developed world and where property prices have spiralled out of reach of many first-time buyers.