Last week, Singaporean Deputy Prime Minister Tharman Shanmugaratnam’s remark that Taiwan had suffered a brain drain sparked concerns that the nation could lose out to competitors even more if urgent countermeasures are not taken.
Were politicians’ and business leaders’ concerns just a knee-jerk response to criticism from abroad? Will Taiwan ignore this wake-up call, just like it has so many others?
In a speech given on Thursday in Singapore, Shanmugaratnam said Taiwan faced difficulties in keeping domestic talent and attracting foreign professionals. He cited Taiwan’s closed-door policy on foreigners as the main factor behind the country’s stagnating wages.
“If you don’t provide opportunities in Singapore for enterprises to be global-class and highly competitive, and for Singaporeans to work in the best teams, we will lose more of our Singaporeans, and we will be a Taiwan story,” the Straits Times quoted him as saying.
The criticism is nothing new. In recent years, there has been an increase in complaints from domestic educational and research institutes that they are unable to hire qualified professionals from abroad because they are barred from paying as much as their counterparts in China, Hong Kong, South Korea and Singapore, while the US and European chambers of commerce have been pushing for years for the government to change its rules for foreigners doing white-collar jobs in Taiwan.
On the heels of growing concerns that Taiwan suffers from a costly talent shortage — even though the number of graduates from local colleges, universities and graduate schools has increased sharply over the years and the nation has become an exporter of skilled professionals — Academia Sinica President Wong Chi-huey (翁啟惠) and his colleagues warned in an open letter to the government in August last year that Taiwan could face a serious brain drain over the next decade. The letter urged the government to get rid of outdated laws and red tape, but nothing has been done thus far to improve the situation.
There are many causes for Taiwan’s brain drain. Some people have left the country for higher salaries abroad, some have migrated overseas in search of a better political and social environment, while others have been lured away by cultural affinity to other countries. While the Constitution protects people’s rights and freedom to move around, it is the loss through migration of Taiwanese white-collar talent, rather than any influx of foreign white-collar workers, that poses the gravest concern for Taiwan’s economic competitiveness.
When Hon Hai Precision Industry Co chairman Terry Gou (郭台銘) said last week he planned to raise wages for the firm’s Taiwanese employees in July as people here are faced with a rising cost of living, there was not just the hope that Hon Hai’s move would prompt other businesses to follow suit, but that this would also remind them of their most precious asset — their employees. On the other hand, when Council of Labor Affairs (CLA) Deputy Minister Pan Shih-wei (潘世偉) on Friday blamed Taiwan’s comparatively low wages for the country’s failure to retain local talent and attract foreign professionals, Acer Inc founder Stan Shih (施振榮) said that it was time for the CLA to change its mindset on employment policy.
If local businesses are still unwilling to pay higher salaries for either domestic or foreign professionals and if the government does not take action to improve the regulatory system to ensure a steady influx of such individuals, there is no chance Taiwan’s economy will thrive in the decades ahead.
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