Hong Kong unemployment rate hits highest in more than 9 years

Asia Business World

HONG KONG: Hong Kong’s unemployment rate rose to the highest in more than nine years in the first quarter as the coronavirus pandemic dealt a sharp shock to an economy already in recession.

The seasonally adjusted jobless rate in January to March rose to 4.2 per cent from 3.7 per cent in the previous three-month period, government data showed on Monday (Apr 20).

The underemployment rate hit nearly a decade high of 2.1 per cent, from 1.5 per cent in the previous three-month rolling period.

Total employment fell by around 48,800 to 3.72 million.

READ: Hong Kong reports zero new coronavirus cases for first time since early March

The year-on-year declines in total employment and the labour force widened further to 3.6 per cent and 2.2 per cent respectively, both the largest on record.

The unemployment rate in the consumption and tourism-related sectors combined soared to 6.8 per cent, the highest since the global financial crisis a decade ago.

“The labour market will continue to face significant pressure from the economic fallout arising from the pandemic in the near term,” Secretary for Labour and Welfare Law Chi-kwong said in a statement.

READ: COVID-19 sparks boom for local farmers in import-dependent Hong Kong

The government earlier this month announced relief measures worth HK$137.5 billion (US$17.7 billion) to help businesses and people losing money due to the coronavirus outbreak to stay on their feet, and urged employers not to lay off workers.

Around 10,400 retail employees are expected to lose their jobs in February to May, about 4 per cent of the 260,000 workforce in the retail sector, Hong Kong Retail Management Association said.

Hong Kong’s economy contracted for the first time in a decade in 2019 due to often violent anti-government protests and the US-China trade war.

While the government of the Asian financial centre has stopped short of full lockdowns seen in some other cities, the recession is expected to deepen this year.

The Chinese-ruled city recorded zero new coronavirus cases on Monday for the first time since early March, health authorities said, though they urged residents to maintain strict hygiene and social distancing practices and avoid unnecessary travel. 

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