ENG-2019 — Page 83

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The Economy

and construction works shrank further, as new projects had yet to generate sufficient output to offset the completion of some major infrastructure projects. The costs of ownership transfer fell amid declining property transactions, especially in the non-residential segments.

Labour Market

The labour market came under increasing pressure during 2019. Having stayed at a low of 2.8 per cent in the first two quarters, the seasonally adjusted unemployment rate went up successively to 2.9 per cent in the third quarter and 3.3 per cent in the fourth quarter when the economy fell into recession. The unemployment rates of the retail, accommodation and food services sectors increased more visibly, particularly in the second half of the year as business was hit hard by the local social incidents involving violence. The underemployment rate also edged up in the fourth quarter after staying low in the first three quarters. For 2019 as a whole, the unemployment rate averaged 2.9 per cent, up 0.1 percentage points from 2018, while the underemployment rate averaged 1.1 per cent, the same as in the preceding year (chart 8).

Chart 8

Unemployment and Underemployment Rates

Per cent

5

4

3

2

1

Seasonally adjusted unemployment rate

Underemployment

rate

T

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2015

2016

I

Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2017

2018

2019

The labour market came under increasing pressure during 2019, with the seasonally adjusted unemployment rate rising steadily in the second half.

The labour force and total employment decreased 0.3 per cent and 0.4 per cent respectively in 2019, in contrast to the corresponding growth of 0.8 per cent and 1.1 per cent in 2018 (chart 9). Data collected from private-sector establishments showed some signs of easing in labour demand in the first half of 2019, with the situation deteriorating further in the second half as the decline in employment widened and the number of vacancies continued to dive. The number of private-sector vacancies plunged 13.5 per cent to 67,630 in 2019. Reflecting a slackening in the overall manpower balance, the ratio of job vacancies per 100 job-seekers decreased visibly from 70 in 2018 to 58 in 2019. The slackening in labour demand was particularly notable in construction, import/export trade and wholesale, food and beverage services, and retail.

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