Hong Kong jobless rate sets new high


While there were more jobs in Hong Kong, there was also a greater number of people looking for work in the territory

By Alex Frew McMillan

HONG KONG, China (CNN) -- Hong Kong's jobless rate reached an unprecedented 7.8 percent in the three months ending in July, the government has said.

That's up from the old record of 7.7 percent set the month before, but slightly better than the 7.9 percent economists had expected.

As Hong Kong grapples with its second recession in four years, unemployment has jumped in the construction, retail, business services, communications, sanitary services and recreation sectors.

The 7.8 percent rate, still provisional, means there are now 275,000 people officially out of work in Hong Kong.

Employment rise

Despite the jobless rise, total employment rose 1.0 percent for the three months through July, bringing the territory's work force to 3.5 million, with more jobs in the restaurant, real estate, manufacturing and property-maintenance industries.

But the rise in new jobs was outpaced by more people looking for work. Laid-off staff, graduates and school leavers have swelled the number of job seekers.

There was also some good news in the underemployment rate. That eased to 2.8 percent from 2.9 percent.

The unheralded jobless rise comes as suicide rates in the territory near historic highs. Bad debts are hitting banks' bottom lines. (Full story)

The government has renewed its pledge to combat unemployment through programs such as its youth work-experience scheme.

The spokesman said the government is also committed to fighting illegal employment. A crackdown started in July by the police and the immigration departments has led to the arrest of 500 people.

Hong Kong's Hang Seng index lost 0.18 percent on Monday to end at 10,246.96, just before the jobless rate was released. (Full roundup)

The jobless news came as Commerce, Industry and Technology Secretary, Henry Tang, said he expects the territory's first half GDP to contract slightly.