Total employment dropped to 3.8m.
The seasonally adjusted unemployment rate dropped to 3.2% in the January-March quarter, compared to 3.3% in the December-February period, the Census & Statistics Department announced.
The underemployment rate remained unchanged at 1.2%.
Total employment decreased by 2,000 to 3,822,400, while the labour force increased by 3,600 to 3,947,400.
There were 125,000 unemployed people and 49,000 underemployed people.
Secretary for Labour & Welfare Stephen Sui said: "The unemployment rates of many sectors were generally lower than their year-ago levels amid the relatively favourable overall economic conditions on entering 2017."
He said the labour market is expected to remain tight in the near term and the Government will monitor the potential impact of external uncertainties on the local economy.
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