Notes from the Taiwan Center: Taiwanese migrant workers and the wage crisis

Most of us think of the nation as a place that absorbs migrant workers, but we also send them more and more as wages stagnate

  • By Michael Turton / Contributing Journalist

Demand for Taiwanese migrant workers in Singapore is booming: there are over a thousand jobs on many websites, with adverts for cabin crew, executive assistants, engineers, credit, even auto mechanics, all for far more than they could earn in Taiwan. .

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

Last week, the government issued another of its periodic warnings that some foreign employers are actually enslaving Taiwanese to internet and phone scams, particularly in Cambodia. The government has announced that it will place officers at airports to monitor these fraudulent jobs. Far too late, of course, as such scams have been rounding up Taiwanese workers for years.

Photo: ANC

For example, in 2015 in Brisbane, an impetus for the freedom of an enslaved Taiwanese exposed a slavery ring targeting Chinese victims using Taiwanese captives. Just last week, Taiwanese officials exposed a scam in Dubai that landed 22 Taiwanese in a nightmarish situation where they were tortured and beaten if they didn’t perform.

Cambodia is notorious for these slavery rings, which force people to work for online casinos, restaurants and even blood harvesting. Workers are bought and sold as chattels in criminal networks. Nationals of most countries in the region have been caught in such scams.

The reason people find the obvious fraudulent jobs so appealing: Taiwan’s stagnant wages, as well as the island’s brutal work schedules. A 2020 survey of salaried workers by a local job bank found that 90% wanted to be able to work abroad. China was once a major destination for young people, but since 2016 interest in it has dropped precipitously, partly because of politics, partly because supply chains are shifting away from China.

Taipei Time File Photo

RISE OF ONLINE PLATFORMS

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

Survey work and academic research show that Taiwanese migrant workers tend to be young and highly educated. Many have no desire to return home. A study reveals a hidden factor: the rise of online job platforms means that there are many other options for immigration candidates.

For example, Professional Technology Temple (PTT), the country’s largest message board popular with students, has a section on overseas jobs. Platforms like JobStreet for Singapore, Worklife for Japan, LinkedIn and many Facebook groups also post vacancies. 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,” a Taiwanese woman who had worked for a government agency in Singapore told me. She is going back there soon for another job. Like many Taiwanese migrant workers, she enjoyed the cosmopolitan experiences that one of Asia’s leading globalized cities offers.

While Taiwan proudly touts its “competitiveness” as rated by international ratings agencies, its workers say in polls that wages are much higher overseas. These are two sides of the same coin, Taiwan’s “competitiveness” being largely driven by its low wages coupled with its relatively high productivity.

UNDERPAID AND OVERTRAINED

In a 2016 paper, National Taiwan University researchers Tobias Haepp and Hsin Ping-lung (辛炳隆) showed that Taiwanese workers’ underpayment dates back more than two decades, even to that time. Capital, on the other hand, is overpaid, especially in manufacturing.

The cause of low wages is complicated. Residents often attribute them to over-education: there are too many university graduates.

The question, 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 researchers, are the interrelated problems created by Taiwanese SMEs, lack of labor mobility and lack of English skills.

In 2017, government statistics show there were more than 1.4 million SMEs in Taiwan employing more than three-quarters of the workforce, with nearly 80% of them in the service sector. Hsieh and his team point out that large companies made up just 2.2% of businesses in the service sector, but generated more than 70% of its sales, with SMEs generating just over 28% of sales.

In addition, the chapter notes, 5.2 million workers worked in the service sector, mostly in SMEs. The 70% of sales produced by large companies in the service sector are produced by only half a million workers.

Taiwanese industry is mostly concentrated in low value-added manufacturing, despite the focus on a minority of elite companies that are champions in their fields. Companies with low added value have little leeway to raise wages. The situation for value added in services, according to the chapter, is even weaker, with poorer prospects for wage increases.

The conclusion is clear: too many workers are “trapped” in SMEs, as Hsieh put it. Once in the SME lane, workers tend to stay in SMEs, with less than 10% successfully escaping the SME world. This means that more than 90% stay there.

This should match 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 from jobs like frogs changing puddles under the rain. This SME trap is exacerbated by the low level of English of this workforce.

LACK OF OPTIONS

For those entering the job market, it is difficult to build a career, “since the good jobs are mainly concentrated in the finance and IT sectors”, and the jobs often require experience, according to a scholar who interviewed Taiwanese migrant workers in Hong Kong and Japan. . Finance professionals with experience and higher degrees will also find it easier to find work abroad, the document notes.

“The two main fields of study in which Singapore snatch most Taiwanese talent – hotel management and early childhood education – are both among the lowest-paying fields in Taiwan,” observed Commonwealth Magazine. It was in 2014.

Workers are well aware that low wages early in life mean lower pensions and retirement resources later in life. Given all of this, it’s no surprise that large segments of this population are contemplating a way out.

There is no easy solution to the multitude of structural problems facing Taiwan, but chief among them is forcing employers, especially in manufacturing, to return more of their earnings to their workers. (including the hundreds of thousands of migrant workers here in Taiwan). Otherwise, the exodus will simply escalate over time and other countries will reap the rewards of Taiwanese efforts and capabilities.

Remember, ten years ago, Oxford Economics predicted that Taiwan would experience the worst talent shortage among advanced economies by 2025.

Notes from Central Taiwan is a column written by longtime resident Michael Turton, providing incisive commentary informed by three decades of living and writing about his adopted country. The opinions expressed here are his own.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. The final decision will be at the discretion of the Taipei Times.

Comments are closed.