Passengers wearing protective masks walk on a moving walkway at Hong Kong station, operated by MTR Corp, in Hong Kong, on Dec 2, 2020. (PHOTO/BLOOMBERG)

Hong Kong’s unemployment rate eased from a 17-year high as the economy emerges slowly from its pandemic slump.

The jobless rate fell to 6.8 percent in the January-to-March period from 7.2 percent previously, the first decline since November, according to a government report Thursday. That’s better than the 7.1 percent median forecast in a Bloomberg survey of economists. The underemployment rate also fell to 3.8 percent.

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The labor market was under notable pressure in the first quarter of 2021, but the situation stabilized in the latter part of the quarter as the fourth wave of the local epidemic receded. 

Law Chi-kwong, Hong Kong Secretary for Labor and Welfare

"The labor market was under notable pressure in the first quarter of 2021, but the situation stabilized in the latter part of the quarter as the fourth wave of the local epidemic receded," Secretary for Labor and Welfare Law Chi-kwong said.

The unemployment rate of the consumption- and tourism-related sectors, namely retail, accommodation and food services sectors, combined fell by 0.4 percentage point to 10.7 percent. In particular, the rate for food and beverage service went down from 14.1 percent to 13.3 percent.

Looking ahead, Law said the labor market may still face challenges in the near term as the pace of recovery is uneven across sectors.

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However, if the local epidemic situation continues to be contained, the operating environment for consumer-facing economic sectors may improve, which will help ease the pressure on the labor market, he said. 

Government officials have hinted at a gradual easing of coronavirus restrictions, which would help spur the economy after an extended recession that began before the pandemic. Hong Kong Chief Executive Carrie Lam Cheng Yuet-ngor told the media this week the worst seems to be over, with the economy likely to see growth of about 3 percent to 5 percent for the full year.