Hong Kong's jobless rate probably jumped to 5.4 percent in January-March, its highest level since late 2005 as lay-offs accelerated amid a deepening economic recession, a Reuters survey showed on Friday. Rising unemployment, which in December-February stood at 5 percent, is hurting consumer spending and aggravating a recession that began in the third quarter of last year.
Companies have been laying off staff across the board as the financial sector has been hit by global headcount cuts at investment banks while exports have plunged this year as global demand has deteriorated. In February, exports dropped 23 percent - the worst performance since 1954.
Bankruptcies have surged as a result. In March, bankruptcies more than doubled from the same month last year, hitting a six-year high at 1,872, government data showed on Friday. Hang Seng Bank expects the jobless rate to rise to 7 percent.