Taiwan's unemployment rate stayed at a five-year low in December due to a decline in first-time job seekers and business closures, the government said yesterday.
The seasonally adjusted jobless rate held at 4 percent for a fourth straight month, the Directorate General of Budget, Accounting and Statistics said yesterday in Taipei. That was in line with the median forecast of 13 economists surveyed by Bloomberg News. Unemployment hasn't been below 4 percent since February 2001, when it was 3.8 percent.
Low unemployment may make households more confident to spend, helping President Chen Shui-bian's government achieve its 4.1 percent economic growth prediction for this year. Taiwan's economy expanded at the fastest pace in a year in the third quarter, driven by rising consumption and exports.
"A low jobless rate should help boost consumption in the first half," said Vickie Hsieh, chief economist at President Securities Corp. in Taipei. "What concerns me is that inflation worries might restrict spending growth."
Consumer prices rose for the first time in four months in December, underpinning expectations that the central bank will raise interest rates this quarter.
The number of people unemployed on the island fell to 403,000 in December from 411,000 the previous month, the report showed. Major decreases included 3,000 in the number of first-time job seekers and 4,000 in the number of those who lost their jobs due to business closures or cutbacks.
Taiwan's jobless rate was 4.2 percent in December 2004.
Without adjusting for seasonal changes, Taiwan's jobless rate was little changed at 3.86 percent in December, the statement said. For the full year, the average unemployment rate was 4.1 percent.