A rebound in Hong Kong's economy is creating more jobs, but the territory's unemployment rate between March and May likely remained unchanged at 7.1 percent as more people looked for work, economists said.
Eight economists polled by Reuters forecast the unemployment rate was 7.1 percent in three months to the end of May on a seasonally adjusted basis, the same level as February-April and an 18-month low.
The government will release the data after 4 pm (0800 GMT) on Thursday. "Fresh graduates will start to look for work. It's a seasonal factor but this year more will be keener to enter the job market straight away as the economy is much better than last year," said Henry Tsoi, economist at Hang Seng Bank.
But it's not just fresh graduates and school leavers scanning vacancy ads. Some 18,900 temporary jobs, mostly created by the government to ease record unemployment during last year's Sars outbreak, expired in March.
Unemployment in Hong Kong has been falling since it peaked at a record 8.7 percent in mid-2003 after the Sars outbreak devastated parts of the already weak economy. But the recovery has slowed in 2004.
The government has forecast the economy will grow by six percent in 2004, up from 3.3 percent in 2003, fired by a boom in China, a strengthening global economy and improving domestic demand.
"What matters is the trend and that's falling. Domestic demand is still strengthening," said Prakash Sakpal, economist at ING Financial Markets.
But as China takes measures to cool its economy and the United States braces for higher interest rates, some economists are cutting their growth forecasts for the territory.
Hiring has picked up in the retail and leisure sectors as well as other tourist-related industries after China relaxed visa restrictions for some its citizens last year. The scheme will be broadened to include more Chinese cities later this year.
Jobs have also been created in the financial industry as Chinese firms clamour to list on the Hong Kong stock exchange.
But Hong Kong's unemployment rate is still the highest among Asia's developed economies. It compares with 4.57 percent in Taiwan, 4.7 percent in Japan and 4.5 percent in Singapore.
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