ENG-2003 — Page 91

Chart 12

Per cent

6

4

-2

-4

THE ECONOMY

Earnings and wages

(year-on-year rate of change in money terms)

2

Wages

0

Earnings

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

1998

2003

1999

2000

2001

2002

Amidst the slackened labour market conditions, overall labour earnings and wages continued on a decline in money terms in 2003. The decline nevertheless showed some narrowing since mid-year.

Analysed by economic sector, labour earnings in money terms fell virtually across- the-board. For all the service sectors surveyed taken together, labour earnings went down by 2.0 per cent in money terms in the third quarter of 2003 over a year earlier, further to declines of 2.1 per cent in the first quarter and 3.0 per cent in the second quarter. Yet, discounting the decrease in consumer prices, labour earnings still gained by 1.6 per cent in real terms in the third quarter of 2003 over a year earlier, as against falls of 0.1 per cent in the first quarter and 0.6 per cent in the second quarter. Analysed by major constituent sector, earnings in community, social and personal services and in restaurants and hotels were slashed by 5.7 per cent and 5.2 per cent respectively in money terms, or 2.2 per cent and 1.7 per cent in real terms, in the third quarter of 2003 over a year earlier. Earnings in transport, storage and communications, in the wholesale, retail and import/export trades, and in financing, insurance, real estate and business services decreased to a lesser extent, by 0.6-1.8 per cent in money terms. In real terms, there were nevertheless increases, by 1.8-3.1 per cent. As to the local manufacturing sector, labour earnings were down by 3.6 per cent. in money terms in the third quarter of 2003 from a year earlier, lesser than the decrease of 5.1 per cent in the first quarter but larger than the decrease of 2.2 per cent in the second quarter. In real terms, labour earnings in this sector edged lower by 0.1 per cent in the third quarter of 2003 from a year earlier, as compared to a fall of 3.2 per cent in the first quarter and a rise of 0.3 per cent in the second quarter.

As to labour wages in the service sectors, those in restaurants and hotels and in personal services were lower by 5.0 per cent and 4.1 per cent respectively in money

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