Hong Kong jobless rate falls third straight month to one-year low

[HONG KONG] Hong Kong's unemployment rate fell to a one-year low in May, the latest sign the city is pulling out of its extended recession.

The jobless rate for the March to May period fell to 6 per cent from 6.4 per cent in the prior month, the lowest level since the indicator was at 5.9 per cent last May, according to data from the Hong Kong Census and Statistics Department. The rate came in below the consensus forecast of 6.2 per cent in a Bloomberg survey of economists.

The unemployment rate has declined for three straight months now, the longest streak since November 2010 to March 2011, when the measure fell for five straight months.

The number of unemployed people dropped by about 14,200 to 233,300 in May from the previous month, while total employment ticked up to about 3.63 million, the data show. However, the labour force decreased slightly, by about 5,800.

"As the economy continues to recover, the pressure on the labour market should gradually ease, especially if the local epidemic remains well contained," Secretary for Labour and Welfare Law Chi-kwong said in the report.

Hong Kong's economy is gradually emerging from its historic two-year recession as sluggish vaccination rates start to rise amid a growing number of incentives offered by businesses, including cash payouts, extra time off and even a chance to win prizes for everything from a Tesla car to gold bars and even a US$1.4 million apartment.

High-frequency data show mobility and vaccinations picking up pace in Hong Kong, "pointing to a virtuous cycle where faster shot and contained virus risks support a sustained recovery", Eric Zhu, economist with Bloomberg Intelligence said in a report Thursday.

The city reported no new coronavirus cases Thursday. Authorities will shorten hotel quarantine for fully vaccinated travellers from most places to seven days as long as they pass an antibody test, people familiar with the matter said.

BLOOMBERG