THE ECONOMY
in real terms in 1991 over 1990. In line with the pick-up in consumer spending during the year, retained imports of consumer goods rose by about nine per cent in real terms.
As the value of total exports (domestic exports plus re-exports) was smaller than that of imports, a visible trade deficit of $13,096 million, equivalent to 1.7 per cent of the total value of imports, was recorded in 1991. If an estimate of the imports of gold for industrial and commercial use was included, the deficit would have been $16,156 million. This compared with a deficit of $2,656 million (or $5,326 million after a similar adjustment for gold imports) recorded in 1990. As the prices of total exports rose at a faster rate than those of total imports in 1991, the terms of trade showed a small improvement.
Domestic Demand
Domestic demand rose by eight per cent in real terms in 1991, following a six per cent growth in 1990. Private consumption expenditure grew by six per cent in real terms in 1991, with increases of six per cent in the first half and seven per cent in the second half. This followed a growth rate of five per cent in 1990. Government consumption expenditure grew by seven per cent in real terms in 1991. The corresponding growth rate in 1990 was six per cent. Investment demand, measured in terms of gross domestic fixed capital formation, grew by 10 per cent in real terms in 1991, having increased by eight per cent in 1990. Among its major components, expenditure on building and construction rose by only one per cent in real terms in 1991, while expenditure on plant and machinery was substantially higher by 18 per cent in real terms.
The Labour Market
The labour market eased in the first half of 1991. It then tightened again in the second half, as the economy continued to grow steadily. In the fourth quarter, the seasonally adjusted unemployment rate was 1.8 per cent, 0.3 of a percentage point lower than in the third quarter, although 0.4 of a percentage point higher than in the same quarter of 1990. The underemployment rate was 1.6 per cent, 0.1 of a percentage point higher than in the third quarter, but 0.8 of a percentage point higher than in the same quarter of 1990.
Between September 1990 and September 1991, manufacturing employment decreased by 10 per cent to 650 000, while employment in the service sectors as a whole increased by six per cent to 1 560 000. Labour resources thus continued to shift from manufacturing to services. Among the various service sectors, employment in the wholesale, retail and import/export trades increased by nine per cent; that in finance, insurance, real estate and business services by six per cent; that in restaurants and hotels by five per cent, and that in water transport, air transport and services allied to transport by four per cent in September 1991 over a year earlier. Employment on building and construction (including civil engineering) sites decreased by 10 per cent. However, for the building and construction industry as a whole, employment (covering both site workers and non-site workers) still showed an increase of one per cent. Vacancies in the manufacturing sector declined markedly, by 36 per cent from September 1990 to 23 300 in September 1991. Vacancies in the service sectors as a whole also fell, by four per cent to 49 100.
Local manufacturing output, as measured by the index of industrial production, increased by one per cent in the first three quarters of 1991 over the same period in 1990. This compared with a decrease of one per cent in 1990 over 1989. The attainment of this level of performance, notwithstanding the significant reduction in manufacturing employment,
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