More than half of employers in Hong Kong have been forced to offer expatriates increased compensation packages to persuade them to move to the increasingly polluted city.
Amid air pollution that is so bad that it is often impossible to see from one side of Hong Kong's harbour to the other, pollution-related deaths are on the increase and foreign investors are staying away due to the scale of the problem. .
Now a survey by HR consultancy Hudson has found that half of senior executives have had to beef up the packages they offer expats in an effort to persuade them to move to Hong Kong at all.
A third of the firms had to offer a much higher salary package, while one in six offered a larger housing allowances, the survey found.
Once viewed as a glamorous destination for expats, particularly from the UK, Hong Kong is increasingly being viewed as a hardship posting, Hudson's Asian head, Gary Lazzarotto said.
Indeed, poor air quality is now a major factor in expats leaving the territory, with four out of 10 of those surveyed saying it is as a contributing factor in why employees decide to leave.
Singapore has become the biggest beneficiary of this trend, with a third of those leaving Hong Kong choosing to relocate there and one in five in Australia.
While most pollution emanates from factories across southern China's Pearl River Delta, pollution is an increasingly hot political issue in Hong Kong.
A new survey by the China Morning Post of 726 business leaders found that more than a third believed improving the environment was the territory's most urgent concern.
Meanwhile, members of the American, Australianł British, Canadian and Japanese chambers of commerce in Hong Kong have all urged the government to act against rising pollution or risk damaging it's international status.
As Gary Lazzarotto added, "there is a fierce war for talent in Asia but Hong Kong is fighting its battle with one hand behind its back."