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Jobless rate declines to 20-month low

Updated: 2010-09-17 07:09

By Li Tao(HK Edition)

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 Jobless rate declines to 20-month low

Construction workers gather outside a building site at the Central and Wan Chai Reclamation project, Hong Kong. The government said Thursday the city's jobless rate fell to 4.2 percent in the June-August period, the lowest in the past 20 months. Jerome Favre / Bloomberg News

Underemployment rate drops to 1.9% in June-August

Hong Kong's jobless rate fell to 4.2 percent during the June to August period, the lowest since January 2009, as new hires successfully absorbed the increase in the labor supply, the government said Thursday.

Unemployment dropped 0.1 percentage point from 4.3 percent in the previous reporting period from May to July, data released by the Census and Statistics Department showed. The city's labor force also increased by around 125,000 during June-August compared with the previous three months.

The underemployment rate also declined 0.1 percentage point to 1.9 percent from the preceding three months.

"It demonstrates that overall labor market conditions continue to improve," said Matthew Cheung Kin-chung, the Secretary for Labour and Welfare.

The number of private sector vacancies posted by the Labour Department in August increased by 42 percent to 74,905 over the same period last year, and up 12.2 percent compared with the preceding three months.

New jobs were mainly seen in postal and courier services, arts, entertainment and recreation, as well as the construction and financial sectors.

Youth unemployment in the June-August period worsened, however, up by 1.3 percentage points to 14.5 percent in the 15-24 age group. Cheung, however, was sanguine about the figures.

"In fact, the total employment showed a significant increase of 12,400, indicating that the market was able to absorb the new batch of fresh graduates and school leavers entering the labor market during the summer," Cheung said.

He also forecast the labor supply to drop in the near term as some of the youngsters who joined the workforce in the summer would go back to school when the new academic year begins in September, therefore easing the pressure from unemployment.

However, Hang Seng Bank Senior Economist Irina Fan, while remaining cautiously optimistic about the outlook for the Hong Kong labor market, doesn't see much upside from here as the pace of economic growth begins to slow.

"The 4.2 percent unemployment rate has probably reached bottom this year as employment has lagged economic growth," Fan said. As the economy cools, Fan expects unemployment rates to stay in a tight band between 4.2 and 4.3 percent in the coming months.

China Daily

(HK Edition 09/17/2010 page3)

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