Economic Letters

9 October 2023

• The natural rate of unemployment in Hong Kong: An update (PDF) (Word)
  Kelvin Wong
  This article provides an update on Hong Kong’s natural rate of unemployment, as measured by the non-accelerating inflation rate of unemployment (NAIRU), with data up to 2022. The estimation is based on a structural regression model that allows interactions between price inflation, wage growth and unemployment rate. The results indicate that the NAIRU for Hong Kong remained broadly stable from 1994 to 2010, averaging 3.7% over that period before rising to 4.4% in 2012, then gradually falling to 2.8% in 2018 and hovering around 3.0% in the ensuing years.