A vendor (left) watches as a customer (right) browses products for sale at her street stall in Hong Kong on March 8, 2021. (ANTHONY WALLACE / AFP)
HONG KONG - Hong Kong’s unemployment rate rose in February to the highest level in 17 years as the adverse effects of the COVID-19 pandemic continue to pummel the local economy.
The seasonally adjusted unemployment rate increased from 7.0 percent for the November to January period to 7.2 percent for December to February, according to a government statement released on Tuesday.
Hong Kong's Gross National Income, which denotes the total income earned by Hong Kong residents from engaging in various economic activities, decreased by 3.8 percent in the fourth quarter of 2020 from a year earlier to US$740.5 billion
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Around 261,600 people were unemployed in the latter period, with distinct increases in the unemployment rate observed in the import and export trade sector; postal and courier activities; education; and arts, entertainment and recreation.
In the same period, the underemployment rate rose from 3.8 percent to a post-SARS high of 4 percent, with about 154,600 people underemployed. Increases were mainly seen in the retail sector; food and beverage service activities; and arts, entertainment and recreation.
"The labour market will still face challenges in the near term as the epidemic has yet to be fully contained and inbound tourism remains frozen,” Secretary for Labor and Welfare Law Chi-kwong was quoted as saying in the statement.
“With the launch of the COVID-19 Vaccination Programme, the threat of the epidemic may gradually recede and this will help ease the pressure on the labour market later in the year. The government will continue to monitor the situation closely," he added.
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Carie Li Ruofan, an economist at OCBC Wing Hang Bank, predicts the city’s unemployment rate will likely peak at 7 percent to 8 percent in the first half of this year before retracing lower gradually and moderately in the second half.
“On a positive note, as local infections have shown signs of abating, the government has relaxed the social distancing measures,” Li said. “Besides, the 2021/22 Budget is more expansionary than expected including over HK$120 billion (US$15.45 billion) counter-cyclical measures. More notably, the vaccination programs at home and abroad may warrant a stronger economic recovery in the second half.”
Meanwhile, Hong Kong's Gross National Income, which denotes the total income earned by HK residents from engaging in various economic activities, decreased by 3.8 percent in the fourth quarter of 2020 from a year earlier to US$740.5 billion, according to a separate government statement.
The Gross Domestic Product, estimated at US$713.7 billion at current market prices in the same quarter, recorded a 4.1 percent decrease over the same period, it added.
