Hong Kong Jobless Rate Was Already Rising Before Coronavirus Hit

(Bloomberg) -- Hong Kong’s jobless rate rose in January for a fourth straight month, reaching its highest level since 2016 as the city’s businesses struggle from the political unrest and also from the disruption starting late in the month caused by the coronavirus outbreak.

The city’s jobless rate rose to 3.4% for the November to January period, the same as the median forecast in a survey of economists. The string of increases was the longest since 2009, in the aftermath of the global financial crisis. The data does not reflect the full impact of shutdowns from the coronavirus outbreak, which emerged toward the end of January.

Hong Kong’s economy last year fell into its first annual recession since 2009 as months of often violent protests put pressure on employers in the city’s services industries including restaurants, bars, travel agencies, hotels and shopping malls. Visitor arrivals, especially from the mainland, have evaporated amid the anti-government protests and further severe declines are expected in February with little travel to Hong Kong and China because of the virus outbreak.

“The labor market will be subject to even more pressure in the near term, as the threat of the novel coronavirus infection has already caused severe disruptions to a wide range of economic activities lately, particularly the consumption- and tourism-related sectors,” said Law Chi-kwong, secretary for labor and welfare. Unemployment for consumption and tourism-related sectors remained at 5.2%, the highest in more than three years, Law said in a statement.

The jobless rate in the construction sector rose further to 5.7%, the highest level in close to six years, according to the statement.

--With assistance from Ailing Tan.

To contact the reporter on this story: Eric Lam in Hong Kong at elam87@bloomberg.net

To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, James Mayger, Jodi Schneider

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