The unemployment rate fell 0.4 percentage points to 6.8 percent in the first quarter, data from the Census and Statistics Department showed.
That compared to 7.2 percent from December 2020 to February 2021.
The underemployment rate also fell 0.2 percentage points to 3.8 percent during January to March 2021.
The number of unemployed persons fell 0.69 percent to 259,800. Over the same period, the number of underemployed persons fell 4 percent to 148,400.
The number of employed persons rose 0.11 percent to 3.61 million. The labor force also increased slightly to 3.87 million.
The unemployment rate of consumption- and tourism-related sectors combined fell by 0.4 percentage point from the preceding three-month period to 10.7 percent. Among these sectors, the unemployment rate for food and beverage service activities declined from 14.1 percent to 13.3 percent.
Looking ahead, the Secretary for Labour and Welfare, Law Chi-kwong said, "As the pace of recovery is uneven across sectors and inbound tourism remains in the doldrums, the labor market may still face challenges in the near term."
The Labour Department recorded a total of 84,421 vacancies in the private sector in March, a rise of 50.1 percent year-on-year and month-on-month.