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Growth in Taiwan's average salary lower than rivals: report

2014/10/12 13:59

University graduates (CNA file photo)

Taipei, Oct. 12 (CNA) The average monthly salary of employees in Taiwan's industry and services sector was US$1,533.9 in 2013, a 9 percent increase since the financial crisis of 2008, but the growth rate is less than half of that existing in Hong Kong, Singapore and South Korea, local Chinese media the Economic Daily News reported Saturday.

The average salary grew by 25.9 percent in Hong Kong, 22 percent in South Korea, and 31.4 percent in Singapore during the same five-year period. The average salary in Singapore was US$3,693.8 in 2013, about 2.4 times that of Taiwan, according to the Organization for Economic Co-operation and Development's (OECD's) data cited by the newspaper.

The growth in Taiwan's salary was obviously slower than the three other Asian Tigers, making the gap in salary between Taiwan and the three newly industrialized economies much wider.

However, Taiwan's salary lags rivals, not because its productivity isn't competitive, but because productive Taiwanese workers need to work longer hours to feed their family.

Taiwanese workers in the manufacturing sector reported average hourly earnings of US$9.46 in 2012, which is less than half of their counterparts' US$20.72 in South Korea and US$24.16 in Singapore, the newspaper pointed out.

The growth in salary levels has been slower since 2008, but real salary levels in some key countries still rose by about 5 percent during recent years. However, Taiwan has fallen short, Kung Ming-hsin, the Vice President of think tank Taiwan Institute of Economic Research, told the newspaper.

The salary level in Taiwan has been statistically inconsistent with its productivity during recent years, Kung added.

This is related to the structure of Taiwan's industries. Only workers with specialized skills or with core competencies can earn higher salaries, but there aren't many such job positions available in Taiwanese companies, Kung explained.

Also, too many university graduates in the job market make it difficult for firms to differentiate who are suitable prospective employees, resulting in the leveling of lower salaries for entrants in the job market and some competent young people leaving the market, Kung added.

Kung also thinks that the labor market has failed to some extent and that the government needs to do something about it.

Although Taiwan's economy has improved since 2008, only 18.8 percent of firms raised salaries for their emplyees in 2013, according to a survey by the Directorate-General of Budget, Accounting and Statistics.

(By Kuo Chung-han)Enditem/Shradhha