ENG-2004 — Page 90

60 The Economy

leaped by 15.8-82.9 per cent and 29.6-99.2 per cent respectively in December 2004 over a year earlier.

Labour income, as a lagging indicator, remained soft in money terms, but the decrease was smaller in 2004 than in 2003. Specifically, overall labour earnings in the private sector, as measured by payroll per person engaged, edged lower by 0.6 per cent year-on-year in money terms in the fourth quarter of 2004 and by 0.7 per cent in 2004 (Chart 12). In real terms, the corresponding decreases where 0.9 and 0.2 per

cent.

Chart 12

Per cent

3

2

Earnings and wages

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

Earnings

1

Wages

0

-1

-2

-3

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

1999

2002 | 2003

2004

2000

2001

Labour income continued to fall for most of 2004, but the magnitude of decline was smaller than that in 2003.

Analysed by economic sector, labour earnings in the service sectors exhibited divergent movements. While year-on-year increases in money terms were observed for the wholesale and import/export trades, restaurants and hotels, financing, insurance, real estate, and miscellaneous personal services in the fourth quarter of 2004, these were more than offset by declines in other sectors such as the retail trade, land transport and business services. For all the service sectors taken together, labour earnings were down by 0.7 per cent in money terms or 0.9 per cent in real terms. Over the same period, labour earnings in the local manufacturing sector nevertheless increased mildly by 0.3 per cent in money terms or 0.1 per cent in real terms.

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