HONG KONG: The unemployment rate has edged up a little further, maintaining its steady month-by-month trend of worsening jobless totals in Hong Kong.

Official figures place the unemployment rate at 4.1 percent, three tenths of a percentage point higher than they were during the September-November period. More than 140,000 people are out of work, the government announced yesterday. The government statement predicted the number of unemployed would continue to grow over the next few months.

According to official figures, approximately 141,300 people lost their jobs from October through December. That's 4,900 more than during the September-November period.

The increase in unemployment hit hardest in decorating and maintenance, in restaurants, import-export trades, transport and manufacturing sectors.

According to the Census and Statistics Department (CSD), total employment rose by 11,200 to 3,544,300 while the labor force swelled by 16,200 to a historic high of 3,685,700.

Labor demand was boosted by brisk business during the run-up to Christmas and New Year but the growth in the labor force outpaced available job opportunities, the government explained.

Meanwhile, Secretary for Labour and Welfare Matthew Cheung Kin-chung warned that employers might adjust staffing positions after Chinese New Year.

"I sincerely call on employers to seriously explore measures other than staff redundancies to weather the financial crisis. A committed workforce is an invaluable asset and layoffs should not be considered lightly," he said.

The unemployment rate started to swell from July to September, when the economic upheaval generated waves of layoffs across Hong Kong.

The CSD figures showed that the number of underemployed persons soared by 4,700 to 69,800 in October-December, pushing up by 0.1 percentage point to 1.9 percent, the number of individuals unable to obtain work matching their skills and education.

Economic experts expect a higher unemployment rate after the traditional New Year holidays.

Irina Fan, senior economist of Hang Seng Bank, predicted the jobless rate would climb as high as 6 percent in 2009.

"The global economic turmoil slashes businesses in import-export trades, which encumbers logistics and transportation, while retail and catering sectors will be badly hit after the Chinese New Year and we can expect a decreasing number of tourists," she explained.

Fan thought the market would be in deeper distress in the first half of 2009, while the situation might be alleviated in the second half. Government infrastructure projects commence recruitment of work forces early in the second half.

She said it is too early to forecast if the unemployment rate would shoot up as high as 8 percent as it did during the SARS outbreak. The historic-high came after six years of economic downturn during the Asian financial crisis.

Fred Kwan Yum-keung, Economics and Finance associate professor at City University of Hong Kong, believes the unemployment rate in October-December did not reflect the complete picture of the financial turmoil.

"The global market is awaiting any good news from the new United States president, and I'm quite optimistic as Barack Obama's cabinet consists of financial elites," he said.

Kwan added when enterprises revive confidence in the economy, more jobs will open and that should bring the unemployment rate back to more reasonable levels.

Job vacancies in the private sector plunged 4.2 percent last month, though the figure of over 670000 jobs in 2008 soared 20 percent year on year.

The labor and welfare chief said the government would expedite recruitment for over 60,000 positions.

(HK Edition 01/20/2009 page1)