Chart 8:
20
15
10
5
0
-5
-10
-15
Per cent
THE ECONOMY
Main components of domestic demand (year-on-year rate of change in real terms)
Government consumption expenditure
Investment expenditure in terms of gross domestic fixed capital
formation
Private consumption expenditure
-20
1989 1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
54
Local consumer spending revived steadily over the course of 1999. Yet investment spending stayed weak, amidst the relatively high real interest cost and the cautious attitude of the banks towards corporate lending.
The Labour Market
Labour market conditions remained generally slack in 1999, as many companies were still undergoing consolidation and continued to adopt a cautious attitude towards staffing. Yet towards the end of the year, there was a noticeable pick-up in both employment and vacancies, in tandem with the revival in overall economic activity. In line with this development, the seasonally adjusted unemployment rate, having risen from 5.7 per cent in the fourth quarter of 1998 to a peak of 6.3 per cent in March-May 1999, edged down to 6.0 per cent in the fourth quarter. The underemployment rate moved within a fairly narrow range of 2.8-3.1 per cent during the year. In the fourth quarter of 1999, it stood at 2.8 per cent, down from 3.0 per cent in the fourth quarter of 1998.
For all persons employed, the median hours of work per week lengthened appreciably, from 45 in the fourth quarter of 1998 to 48 in the fourth quarter of 1999. Meanwhile, the proportion of employed persons working for 50 hours or more per week also rose visibly, from 26.0 per cent to 32.6 per cent. There was thus a greater utilisation of the workforce still in employment.
Of particular note was the progressive improvement in manpower resource balance during 1999. On labour supply, the total labour force, though still on an uptrend, underwent some moderation in growth, mainly due to a reduced net inflow of population. As to labour demand, both total employment and total vacancies went up noticeably in the latter part of the year, upon the pick-up in overall economic