While the service sector employs 60 percent of the workforce and accounts for 70 percent of GDP, it does not contribute much to driving economic growth, according to a study released on Wednesday.
The study, conducted by the Chinese-language CommonWealth magazine, found that expansion in the manufacturing sector was the largest contributor to the nation’s strong economic growth last year — at 70 percent.
The other 30 percent came from the service sector and other industries.
Although the number of people working in the manufacturing sector is much lower than that in the service sector, their wages are higher, the report said.
The percentage of the workforce in manufacturing has declined every year from 41.7 percent in 1990 to 36 percent last year.
However, the average monthly wage of the 10 largest manufacturing businesses in the country was NT$61,000 (US$2,110), while salaries at the top 10 service sector companies averaged only NT$43,000.
The study also found that those earnings higher salaries in the service sector mostly work at companies that serve the manufacturing industry, instead of at wholesale and retail enterprises.
“It is risky for a country to focus only on the development of the financial sector,” as evidenced by the 2008 world financial crisis, CommonWealth said.
CommonWealth says manufacturing industries contribute more to the economy of a country because they enjoy higher production value, create more jobs and consume less energy.
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