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Economic Trends by José I. Duarte GRAPH 1 - Population growth and low unemployment levels
(Thousands) 600
500 400
200 300
100 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Population People unemployed Non-resident workers
Unemployment and population
The relationship between demographics and the labour market is fraught with misunderstandings. Some pronouncements are dif cult to contradict, no matter how much fact suggests they are incorrect. On the strength of some statements originating from both the government and private sectors, the uninformed spectator might conclude Macau suffered from high levels of unemployment, caused by an in ux of imported workers. The reality, however, is that the unemployment rate is low by historical and international standards, and its absolute level suggests it is not a major issue for economists.
GRAPH 1 GRAPH 2 - Unemployment and imported labour
(Thousands) 30 25
20 15 10 5
-5 0
-10 -15 -20
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
People unemployed (net balance) Other people authorized to reside in Macau (net balance) Non-resident workers (net balance)
The rst graph reveals that the absolute number of unemployed workers has never been extreme, peaking at about 14,000 unemployed people in 2000 and 2001. For most of the past decade, the number of people without a job has hovered at about 10,000 people. Last year there was one person unemployed in every 60 people, which is hardly a statistic to be upset over.
GRAPH 2
In previous editions of Macau Business we have argued there is only limited competition between residents and foreigners for jobs.
Unemployment and imported labour mostly vary in tandem, as they are both sensitive to similar political, social and economic forces. Even when they do change in opposite directions, indicating a possible inverse relationship, the comparative size of their variations does not appear to indicate a causal relationship.
GRAPH 3 - Changes in selected age groups compared to the overall growth in population between 1999 and 2010
(%)
100 80 60
20 40
0 -20
-60 -40
-80 Below 15 years From 15 to 34 From 35 to 54 Above 55
That neither statistic seems intimately linked to the other is clear from this graph. Moreover, that relationship does not appear to be affected by the inclusion of a newer category, “other people authorised to reside in Macau”. Note, however, that due to changes in data collection for the group of “other people authorised to reside in Macau” the series was incomplete in 2006. This indicator covers only a short span of time, limiting the ability to draw accurate conclusions.
GRAPH 3
What should be of greater concern to commentators are the trends in the population’s age structure. Demographics impact strongly on the labour market and the demand for imported labour. As this graph makes clear, the domestic workforce is shrinking. From 1999 until 2010, the population (including non- resident workers) grew by 28.6 percent but the supply of domestic labour is shrinking. Compared to overall population growth, the number of residents aged 15 or younger shrank signi cantly, at 63 percentage points less than the average. At the other end of the age range, there has been substantial growth in the number of people aged 55 or older. This should be an issue to focus on.
JANUARY 2012
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