"What are they doing!?" This is a question more than a few of us have had on our lips in the past half year. From the commentary pages to journalists' after-hours chatter, to analysts' hair-pulling as the market plunges, and of course, Taipei taxi drivers and legislators, someone (everyone) has a few (many) words of frustration to express over the new govern-ment's policies, or lack of policies. First it's scrapping tax cuts for high-tech companies, then it's the Fourth Nuclear Power Plant
A "stupid" government "making labor the scapegoat," cry legislators, scholars, analysts and workers.
Last Wednesday, the Executive Yuan took the bold move of substituting a 44 hour workweek for the Council of Labor Affairs' (勞委會, CLA) proposal of 84 hours every two weeks. The current workweek is 48 hours. The government's reasoning, according to spokespersons, was that too drastic a reduction in regular working hours would deal too hard a blow to industry, now facing a weak stock market and impending financial crisis. This would mean, according to the CLA, an increase in companies' operating costs, which would lead to industry moving to China or elsewhere where labor is cheaper, plus company closures and layoffs. To compound matters, the official unemployment rate just hit a 15-year high of 3.19 percent.
Simple enough, the logic goes, give workers the incentives they demand, like a humane working day and shorter working week, and they will find themselves out of a job, compliments of globalization. So, "our worker friends should be patient," pleads KMT central committee member Kao Ching-yuan
Patient for what? The economy to collapse on its own? Companies to continue the decade-long trend of China migration? Taiwan is facing an economic and business crisis with or without a shorter workweek. The stock market is down over 40 percent from May this year, one-third (yes, one-third) of the country's banks are insolvent, high-tech companies are laying off investment plans. Tuntex is more concerned with loan payments than it is with its laborers' working hours.
"Forty-two hours a week or 44 hours, there is not much difference," chairman of the National Association of Small and Medium Enterprises
I made Terence Horn, vice president of FIC Computer, repeat himself three times in an interview when he told me labor in China was one-third cheaper than in Taiwan. One-third! And that is why FIC began moving production across the Strait in 1991 and now does all its manufacturing there.
"Mainland labor is just cheaper and it always will be cheaper,"says Richard Wu
The new government does, no doubt, have a political crisis on its hands. CLA Secretary Yang Ruyi pointed out to me the likely political costs of the DPP government adopting an overly pro-labor stand. "After Lien Chan's
I thought the new government was supposed to be pro-labor. I thought I remembered the DPP organizing unions in the 1980's and leading labor strikes in the early 1990's. I definitely do remember Chen making campaign promises about shortening the workweek to 40 hours and giving workers more rights. "We will keep our promises to the workers of Taiwan," Chen said on Labor Day this year. Oops!
The DPP, to be sure, has comfortably made the transition from "siding with the oppressed elements of society, to ruling over them," says Andrew Yen, a professor of labor law at National Taiwan University. But now is not the time to be turning their backs -- and passing economic blame -- on the very people who put them into office (did Chen not capture 50 percent of the southern vote?).
A more practical strategy would be to put effort into building up infrastructure, expanding educational facilities and ushering the Taiwan economy into the new knowledge-based era, not mourning the drifting away of the old economy. In the words of Chung-Hua Institution for Economic Research fellow, Ma Kai (
Macabe Keliher is the Taipei correspondent for The Business Times.
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