The unemployment rate between September and November remained steady at 5.3 percent, but the total number of employed workers increased from 3,415,000 to 3,418,800 between August and October on the back of continued strong economic growth.
The unemployment figure has dropped drastically from a record high of 8.3 percent in the third quarter of 2003, at the height of the SARS outbreak. The current figure is the lowest since September 2001.
The government has lifted the economic growth forecast for 2005 to 7 percent from the previous estimate of 5.5 percent in November.
Hong Kong's gross domestic product grew by 8.2 percent in 2004.
Unemployment increased the most in the construction and restaurant sectors, with manufacturing, education and sanitation services currently providing the best job prospects.
Total unemployment figures between September and November dropped by 3,300 to 190,000.
A government spokesman said that sentiment in the labor market remained generally positive.
"Higher consumer spending and vibrant inbound tourism should continue to create job opportunities for the tourism-related services sector," the spokesman said, adding that the short-term outlook will depend on overall business conditions, particularly corporate sector job creation over the Christmas-New Year period.
HSBC Asia Pacific Chairman Vincent Cheung expects the US interest rate to peak at 4.5 percent in January to complete the adjustment cycle. He said economic growth would reach 5 percent in 2006.
Adjustments to interest rates were completed ahead of schedule, which should ease investor concerns over the further rise of capital costs. Strong economic growth next year will benefit the labor-intensive retail sector in particular.
Chong Tai-leung, an associate professor in the Chinese University of Hong Kong's Department of Economics, expects that the unemployment rate will drop as low as 5 percent in December, due to increased consumer spending and an influx of mainland tourists over the holiday season.
"The city is experiencing strong economic momentum and it is believed that it will translate into an increase in job vacancies across several sectors, particularly in the retail and restaurant industries," Chong said. "The completion of interest rate adjustments will also brighten business prospects, which will ease fears of rising business costs."
(China Daily HK edition December 20, 2005)
