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Employment surpasses pre-crisis level

Updated: 2010-11-17 07:19

By Emma An(HK Edition)

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Employment surpasses pre-crisis level

Jobless rate for Aug-Oct period remains at 4.2%

The city's unemployment rate for the August to October period was 4.2 percent, remaining unchanged from the previous July-September reporting period, the government said Tuesday. But total employment surpassed that of financial economic crisis levels for the first time, it added.

According to the latest figures released by the Census and Statistics Department, total employment rose by around 10,800 to 3,531,400 during the three months between August and October from that of the July-September period, the highest level in three years. Meanwhile, the labor force expanded by around 2,100 over the same period.

Commenting on the latest unemployment figures, Secretary for Labour and Welfare Matthew Cheung Kin-chung said, "Thanks to sustained economic growth and job creation, total employment increased for the fifth consecutive month to attain the highest level in almost three years since November 2007 - January 2008, surpassing for the first time the level before the financial tsunami."

As employment numbers reached a three-year high, the number of unemployed people dropped to a two-year low during the August-October period at 153,200.

Irina Fan, senior economist at Hang Seng bank, said she was "not surprised" at the continued improvement seen in the labor market "because the economy is not slowing down and is still growing."

GDP grew by a better-than-expected 6.8 percent in the third quarter from a year earlier on strong exports and growing domestic consumption. Accordingly, the government raised its full-year GDP growth forecast last Friday to 6.5 percent from the previous 5-6 percent.

Paul Tang, chief economist at the Bank of East Asia, saw the overall situation as improving "although the unemployment rate remained unchanged at 4.2 percent". One reason is that the rise in the number of people employed is encouraging, Tang said.

And things may become even better in the months ahead. With the spending season around the corner, the uptrend is likely to be maintained at least until the end of this year, Cheung said.

"With the support from the seasonal upsurge in business activity in the run-up to Christmas and the New Year, labor demand is expected to stay firm in the next few months, further easing the pressure on unemployment," he said.

Fan agreed, saying that the unemployment rate would be on a downward trend because the coming festivals will give people more reasons to spend. However, she also cautioned that companies are increasingly under inflationary pressure as wages and rents pick up, which will squeeze their margins and therefore hold them back from hiring.

China Daily

(HK Edition 11/17/2010 page2)

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