Hong Kong’s unemployment rate dropped to 6.8 per cent in the first quarter of this year but continued to hover around a 17-year high, with the city’s labour chief warning the job market may still face challenges in the near term.
The rolling figure for the three months ending in March edged down 0.4 percentage points compared with the previous period ending in February, the Census and Statistics Department revealed on Thursday.
About 259,800 people were out of a job, roughly 1,800 fewer than during the December to February period.
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The last time Hong Kong recorded a similar jobless rate before the pandemic was in 2004.
Secretary for Labour and Welfare Law Chi-kwong said the job market was still under pressure in the first quarter, but the situation had started to stabilise towards the end due to the easing of the pandemic.
“As the pace of recovery is uneven across sectors and inbound tourism remains in the doldrums, the labour market may still face challenges in the near term,” Law said.
“Nevertheless, if the local epidemic situation continues to be contained, the operating environment for consumer-facing economic sectors may improve and this should help ease the pressure on the labour market.”
The first quarter of 2021 saw the city’s fourth wave of coronavirus infections – sparked by a ballooning dance club cluster late last year – begin to taper off, with social activities subsequently starting to resume.
The government relaxed a string of social-distancing rules on February 18, reopening gyms, cinemas and beauty salons. Restaurants were also allowed to extend dine-in services to 10pm, while the maximum number of guests per table was raised from two to four.
The city’s voluntary inoculation programme also kicked off in late February, although vaccination rates remain relatively low.
As of Thursday, a total of 1,196,682 doses of Covid-19 vaccines have been administered to the public, according to information on the government Covid-19 website.
According to the census department, roughly 148,400 people in the first quarter were underemployed, falling 0.2 percentage points over the previous three months to 3.8 per cent.
The jobless rate for the retail, accommodation and food services sectors declined 0.4 percentage points to 10.7 per cent, while the figure for the food and beverage service industry dropped from 14.1 per cent to 13.3 per cent. The health activities sector also saw the jobless rate declining notably.
Simon Lee Siu-po, co-director of the international business and Chinese enterprise programme at Chinese University, said the improvement was likely due to the relaxed social-distancing measures.
“But the city has still not fully reopened its borders,” Lee said. “The pandemic contains some undercurrents of risk although the situation is getting better. There is still a chance that the [unemployment] figure can rise a bit in the future.”
Hong Kong confirmed 14 infections on Thursday but remains on high alert after recording its first local case of mutated virus strains on Saturday. The city’s tally of cases stands at 11,718 with 209 related fatalities.
Iris Pang, greater China economist at ING bank, said Hong Kong had not yet emerged from difficulties, noting many economic activities had not resumed due to border restrictions.
“A single figure cannot indicate the job market has become very good again,” she said.
This article Coronavirus: Hong Kong jobless rate drops to 6.8 per cent but still hovering near 17-year high first appeared on South China Morning Post