Thu, Jul 23, 2009 - Page 1 News List

Unemployment hits new record

By Crystal Hsu  /  STAFF REPORTER

The nation’s unemployment rate rose to a record 5.94 percent last month, pushed up primarily by first-time job seekers, the ­Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday, adding that the number of new job seekers was expected to continue increasing over the next two months.

The latest unemployment data, which represent an increase of 0.12 percentage points from May, nonetheless turned out better than the market expectation of 6 percent, leading the statistics agency and analysts to predict that the labor market is approaching the bottom.

“I will not rule out the index exceeding 6 percent in July or August, even though the deterioration appears to have slowed down,” DGBAS Deputy Director Huang ­Jiann-jong (黃建中) said.

The unemployment figure stood at 5.91 percent after seasonal adjustment, representing an increase of 0.07 percentage points from a month earlier.

It is the fourth straight month that the reading, used to track long-term job market performance, rose by less than one percentage point, Huang said, interpreting the data as indicating a move toward stabilization.

Twelve thousand people joined the labor market last month, boosting the unemployed population to 647,000, with 1.38 million people affected by the economic slump in some way, the report said.

The number of people who lost jobs because of business closures or downsizing stood at 1,000 last month, the lowest level in 10 months, Huang said.

He added that unemployment would have reached 6.36 percent if the government had not introduced various stimulus and job-creation programs.

Cheng Cheng-mount (鄭貞茂), chief economist at Citigroup Inc Taiwan, said it would take a long time before the labor market could show concrete improvement, even though the index worsened at a slower pace.

“I don’t see any sign of positive movement for the labor market in the near future,” Cheng said by telephone. “Whatever the pace of deterioration, the latest jobless data sent an unfavorable message to private consumption.”

The average salary stood at NT$35,768 (US$1,090) a month in May, down 0.08 percent from April, the report said.

In the first five months of this year, the average wage contracted 2.95 percent from last year, representing a 2.84 percent decline after adjustment for inflation, the report said.

Johnny Chen (陳擎宏), deputy manager of the economics and industry research department at First Commercial Bank (第一銀行), said the unemployment and wage figures bucked the rising trend of local property prices.

“The rallies in the stock market help account for the inconsistency, which may presage a [housing] bubble,” Chen said.

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