ENG-2007 — Page 93

The Economy 1 53

by the Census and Statistics Department between mid-December 2007 and mid- January 2008, business confidence as revealed by the large establishments in different sectors still generally held up well (Chart 9).

Chart 9

Main components of domestic demand (year-on-year rate of change in real terms)

20

20

Per cent

15

10

5

0

Private consumption expenditure

-5

Investment expenditure

-10

in terms of gross domestic fixed capital formation

Government consumption expenditure

-15

-20

1997 1998 1999 2000 2001

2002 2003 2004 2005 2006 2007

Domestic demand became an important growth engine for the economy in 2007.

The Labour Market

The labour market continued to perform well in 2007. Overall employment, boosted by vibrant business and job creation, rose for the fourth year in a row in 2007, benefiting workers at different skill levels.

The seasonally adjusted unemployment rate fell to a near 10-year low of 3.4 per cent in the fourth quarter of 2007 while the unemployed population declined to 117 800 (Chart 10).

Total employment kept rising in 2007 and reached a record high of 3.53 million in the fourth quarter. The average growth rate for the year as a whole was 2.5 per cent, outpacing the 1.7 per cent increase in the labour supply (Chart 11). While the import/export trades and business services sectors remained major sources of job creation, other domestic services such as repair, laundry, and miscellaneous personal services, restaurants, amusement and recreational services, as well as construction (especially decoration and maintenance) also registered solid gains. Comparing the job numbers at the end of 2007 with the trough in mid-2003, there was an increase of 366 300 or 11.6 per cent, more than double the corresponding increase of 177 300 or 5.1 per cent in the labour supply.