The Chinese National Federation of Industries (CNFI, 全國工業總會) yesterday urged the government to limit a minimum wage hike to 3 percent next year, saying many firms have been affected by a global economic slowdown and expect business to further worsen next year.
The call came ahead of a meeting on Thursday of the Ministry of Labor’s Minimum Wage Review Committee, which reportedly leans toward a 4.8 percent increase.
The trade group comprises 159 associations and represents a majority of local manufacturing firms.
Photo: CNA
It said that 76 percent of its members found a 3 percent wage hike acceptable, citing a survey it conducted among its members from Aug. 1 to Aug. 15.
Twenty-two percent of polled companies support a freeze on wage hikes, citing weak financial performance, it said.
Fifty-one percent reported revenue declines in the first half of this year, while 20 percent said revenue held steady, the survey showed.
Twenty-eight percent, mostly electronics suppliers, reported top-line growth, it showed.
CNFI said most of its members are small and medium-sized enterprises (SMEs) that are poorly equipped to cope with production cost hikes.
If the government insists on steep wage hikes, these businesses would have to pass extra personnel costs to their customers, which would fuel inflation, the group said.
Only 13 percent of SMEs reported revenue growth in the first six months, whereas the ratio was 58 percent for listed companies, it said, citing Taiwan Stock Exchange data.
More than 50 percent of steel, textile, metal, paper and cement product makers filed disappointing earnings reports, and expect business to worsen next year, CNFI said, citing its survey.
A company’s size apparently influences its outlook on business, the group said.
While 44 percent of listed companies expect GDP growth next year, only 10 percent of SMEs share the positive sentiment, while 67 percent are concerned about an economic downturn, it said.
The world is heading toward stagflation as Russia’s invasion of Ukraine pushes up global energy, raw material and food prices, while recurring COVID-19 outbreaks clog supply chains and the flow of trade, CNFI said.
The backdrop explains the reason 38.3 percent of polled companies have a negative view about revenue and profit next year, it said.
A minimum wage hike would not be an issue for large, profitable manufacturers, but would “rub salt into the wound” at smaller firms, CNFI said, urging policymakers to take a cautious approach in dealing with the matter.
Several labor unions, including the Taiwan Confederation of Trade Unions, the Taiwan Federation of Financial Unions (TFFU), the Taiwan Labor Front (TLF), the Taiwan Women’s Links, and the Taiwan Alliance for Advancement of Youth Rights and Welfare, reiterated their demand that the government raise the minimum wage to NT$28,000 next year, saying that soaring inflation has diminished people’s purchasing power.
Despite COVID-19 interruptions, Taiwan is still expected to report relatively high GDP growth this year, so increasing the minimum monthly wage to NT$28,000 and the hourly wage to NT$186 would allow workers to share the economic benefits, TFFU secretary-general Han Shih-hsien (韓仕賢) told a news conference.
The ministry in 2018 submitted a draft minimum wage law to the Executive Yuan, where it has since languished, TLF deputy secretary-general Yang Shu-wei (楊書瑋) told reporters.
Yang urged the government to quickly send the bill to the Legislative Yuan for approval so that a legal mechanism to govern wage hikes can be implemented.
Currently, a minimum wage hike can only be implemented by an executive order following a committee meeting, Chen said.
Additional reporting by CNA
When an apartment comes up for rent in Germany’s big cities, hundreds of prospective tenants often queue down the street to view it, but the acute shortage of affordable housing is getting scant attention ahead of today’s snap general election. “Housing is one of the main problems for people, but nobody talks about it, nobody takes it seriously,” said Andreas Ibel, president of Build Europe, an association representing housing developers. Migration and the sluggish economy top the list of voters’ concerns, but analysts say housing policy fails to break through as returns on investment take time to register, making the
‘SILVER LINING’: Although the news caused TSMC to fall on the local market, an analyst said that as tariffs are not set to go into effect until April, there is still time for negotiations US President Donald Trump on Tuesday said that he would likely impose tariffs on semiconductor, automobile and pharmaceutical imports of about 25 percent, with an announcement coming as soon as April 2 in a move that would represent a dramatic widening of the US leader’s trade war. “I probably will tell you that on April 2, but it’ll be in the neighborhood of 25 percent,” Trump told reporters at his Mar-a-Lago club when asked about his plan for auto tariffs. Asked about similar levies on pharmaceutical drugs and semiconductors, the president said that “it’ll be 25 percent and higher, and it’ll
CHIP BOOM: Revenue for the semiconductor industry is set to reach US$1 trillion by 2032, opening up opportunities for the chip pacakging and testing company, it said ASE Technology Holding Co (日月光投控), the world’s largest provider of outsourced semiconductor assembly and test (OSAT) services, yesterday launched a new advanced manufacturing facility in Penang, Malaysia, aiming to meet growing demand for emerging technologies such as generative artificial intelligence (AI) applications. The US$300 million facility is a critical step in expanding ASE’s global footprint, offering an alternative for customers from the US, Europe, Japan, South Korea and China to assemble and test chips outside of Taiwan amid efforts to diversify supply chains. The plant, the company’s fifth in Malaysia, is part of a strategic expansion plan that would more than triple
Taiwanese artificial intelligence (AI) server makers are expected to make major investments in Texas in May after US President Donald Trump’s first 100 days in office and amid his rising tariff threats, Taiwan Electrical and Electronic Manufacturers’ Association (TEEMA, 台灣電子電機公會) chairman Richard Lee (李詩欽) said yesterday. The association led a delegation of seven AI server manufacturers to Washington, as well as the US states of California, Texas and New Mexico, to discuss land and tax issues, as Taiwanese firms speed up their production plans in the US with many of them seeing Texas as their top option for investment, Lee said. The
RSS