Unemployment rate up; more rises expected

The China Post staff

Taiwan’s unemployment rate in June edged up 0.09 of a percentage point from the preceding month to reach 5.11 percent, which is also 0.63 of a percentage point up from the same month of last year, according to the Directorate General of Budget, Accounting and Statistics (DGBAS).

There were 509,000 unemployed persons in June, up 10,000 from May. The employed population totaled 9.45 million last month, representing a slight increase of 3,000 from the previous month. Of this figure, the number of people who lost their jobs because of factory closures or business downsizings posted a decrease for the fifth consecutive month, down by 11,000 in June, Chen Jin-cherng, deputy director of the bureau of census under the DGBAS, said.

If the number of unemployed people caused by factory closures or downsizings continues to go down, Taiwan’s unemployment rate for 2002 is expected to be between five percent and 5.1 percent, Chen said.

Chen said the seasonally adjusted jobless rate for June edged down 0.03 of a percentage point from May to 5.16 percent.

But another 208,000 unemployed — down 8,000 from May — were not included in the unemployment figure because they were not actively seeking employment. When these people are included, the broadly defined unemployment rate hits 7.05 percent for the month.

Chen said the unemployment rate rose to 5.11 percent last month from 5.02 percent in May mainly because new graduates have started entering the job market. The jobless rate in July and August is expected to rise further as even more new graduates enter the job market. New graduates now spend an average of more than six months to get a job, about one month longer than a year earlier, he said.

Many think the jobless rate during the July-August period may reset the record 5.33 percent posted in October 2001. But Chen said that the job market should start to stabilize in September.

However, new developments in the job market during coming months would depend on whether the economic recovery seen so far this year will maintain its steam.

Leading economic research organizations have raised their economic growth forecasts for this year, reflecting a brighter outlook for the second half of the year, he noted.

On the other hand, the growing uncertainty surrounding the U.S. economic outlook, as evidenced by the weakening of the U.S. dollar, is likely to cast a shadow over Taiwan, he said.

“How such uncertainty is to impact Asian economies, including Taiwan, remains to be seen,” Chen said. Leading academic research institute Academia Sinica last week raised its economic growth forecast for this year to 3.24 percent from earlier projection of 3.08 percent, due mainly to an upturn in export shipments.