Mon, Aug 15, 2022 page13

• Notes from Central Taiwan: Taiwanese migrant workers and the salary crisis

  Most of us think of the nation as place that absorbs migrant workers, but we are also increasingly sending them out as wages stagnate

  • By Michael Turton / Contributing Reporter
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  Demand for Taiwanese migrant workers in Singapore is booming: there are more than a thousand jobs on many Web sites, with advertisements for cabin crew, executive assistants, engineers, credit analysts, even auto mechanics, all at far more than they could earn in Taiwan.

  Most of us think of Taiwan as place that absorbs migrant workers, but we are also a place that is increasingly sending them out. This has important ramifications for the future of Taiwan.

  Last week, the government issued another one of its periodic warnings that certain overseas employers are actually enslaving Taiwanese into conducting Internet and phone scams, particularly in Cambodia. The government announced that it would station officers at airports to watch for such scam jobs. Much too late, of course, as such scams have scooping up Taiwanese workers for years.

  

  More than 3,000 protestors demand higher wages at last year’s International Workers’ Day march in Taipei.

  Photo: CNA

  For instance, in 2015 in Brisbane a dash for freedom by an enslaved Taiwanese revealed a slavery ring targeting Chinese victims using Taiwanese captives. Just last week, Taiwan officials revealed a scam in Dubai that lured 22 Taiwanese into a nightmare situation in which they were tortured and beaten if they did not perform.

  Cambodia is notorious for such slavery rings, which force people to work for online casinos, food service and even harvesting blood. Workers are bought and sold as chattel across criminal networks. Nationals of most countries in the area have been caught up in such scams.

  The reason people find obvious scam jobs so attractive: wage stagnation in Taiwan, along with the island’s brutal work schedules. A 2020 survey of salaried workers by a local job bank found that 90 percent wished they could work abroad. China used to be an important destination for the young, but since 2016 interest in it has fallen precipitously, partly due to politics, partly due to supply chains shifting away from China.

  

  A police officer holds a sign at the Taoyuan International Airport warning people of overseas work scams.

  Taipei Times File Photo

  RISE OF ONLINE PLATFORMS

  2015 figures released by the National Development Council (NDC) showed that over 700,000 Taiwanese were working abroad. That number peaked in 2019 at nearly 740,000, but fell back to just over 500,000 last year as Taiwanese continued to exit China.

  Both survey work and scholarly research show that Taiwanese migrant workers tend to be young and college-educated. Many have no desire to return home. One study finds a hidden factor: the rise of online job platforms means that there are many more options for would-be migrants.

  For example, Professional Technology Temple (PTT), the nation’s largest Internet bulletin board popular with college students, has a section on overseas jobs. Platforms like JobStreet for Singapore, Worklife for Japan, LinkedIn, and numerous Facebook groups also post openings. The group tortured in Dubai was recruited via Facebook, for example. Local job banks such as 104, 1111, ES123, and 518 also include overseas opportunities.

  “Really, there are so many now,” one Taiwanese woman who had worked for many years in a Singapore government agency told me. She is heading back for another job there soon. Like many Taiwanese migrant workers, she enjoyed the cosmopolitan experiences that one of Asia’s major globalized cities offers.

  While Taiwan proudly touts its “competitiveness” as assessed by international ratings organizations, its workers tell surveys that salaries are much higher overseas. These are two sides of the same coin, Taiwan’s “competitiveness” being driven in large part by its low salaries coupled with its relative high productivity.

  UNDERPAID AND OVEREDUCATED

  In a 2016 paper, National Taiwan University researchers Tobias Haepp and Hsin Ping-lung (辛炳隆) showed that underpayment of Taiwanese workers extended back more than two decades even at that time. Capital, by contrast, is overpaid, especially in the manufacturing sector.

  The cause of the low salaries is complicated. Locals often attribute them to overeducation: there are too many college graduates.

  The issue, argues an excellent chapter on small- and medium-sized enterprises (SMEs) in Taiwan in Industrial Development of Taiwan: Past Achievement and Future Challenges Beyond 2020 by Hsieh Nien-yi (謝念億) of the Chunghwa Institution for Economic Research (CIER) and several other scholars, is the interlocking problems created by Taiwan’s SMEs, the lack of labor mobility and the lack of English skills.

  In 2017, government statistics show, there were over 1.4 million SMEs in Taiwan employing more than three-fourths of the labor force, nearly 80 percent of which were in the services sector. Hsieh and her team point out that large enterprises accounted for only 2.2 percent of service sector firms but generated over 70 percent of its sales, with SMEs generating only slightly more than 28 percent of sales.

  Additionally, the chapter notes, 5.2 million workers were in the services sector, largely in SMEs. The 70 percent of sales produced by large service sector firms are produced by just half a million workers.

  Taiwan’s manufacturing is predominantly concentrated in low value-added manufacturing, despite attention given to a minority of elite firms that are champions in their fields. Low value-added firms have little room to raise wages. The value-added situation in services, the chapter contends, is even lower, with worse prospects for wage increases.

  The conclusion is clear: too many workers are “trapped” in SMEs, as Hsieh put it. Once in the SME path workers tend to stay in SMEs, with less than 10 percent managing to escape from the SME world. That means over 90 percent remain there.

  This should correspond to the experience of many readers, who watch their friends and former students whirl around a merry-go-round of identical low-paying jobs with long hours, jumping jobs like frogs switching puddles in the rain. This SME trap is exacerbated by the low English ability of this workforce.

  LACK OF OPTIONS

  For people entering the job market, it is difficult to make a career, “since good jobs are concentrated mainly in the finance and IT sectors,” and jobs frequently demand experience, according to one scholar who interviewed Taiwanese migrant workers in Hong Kong and Japan. Finance professionals with experience and advanced degrees will also find work overseas more easily, the paper noted.

  “The two main areas of study from which Singapore snatches most Taiwanese talent — hospitality management and early childhood education — both count among the lowest-paying fields in Taiwan,” observed Commonwealth Magazine. That was in 2014.

  Workers are well aware that low wages early in life means lower pensions and retirement resources later in life. Given all this, it’s not surprising that large segments of this population are eyeing a way out.

  There is no easy way out of the host of structural problems facing Taiwan, but chief among them is forcing employers, especially in manufacturing, to return more of their gains to their workers (including the hundreds of thousands of migrant workers here in Taiwan). Otherwise, the exodus will simply gain momentum over time, and other countries will reap the benefits of Taiwanese effort and ability.

  Remember, a decade ago Oxford Economics predicted that Taiwan would have the worse talent shortage among the advanced economies by 2025.

  Notes from Central Taiwan is a column written by long-term resident Michael Turton, who provides incisive commentary informed by three decades of living in and writing about his adoptive country. The views expressed here are his own.
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