As soon as the graduation ceremonies come to an end, newly turned out university graduates have to look for jobs, pounding the keyboards and working their mobile phones. Taiwan’s unemployment rate last year was 4.39 percent, with the jobless rate for new graduates aged 20 to 24 hitting a high of 12.71 percent.
That means new graduates account for much of the overall level of unemployment. This could be because new graduates are waiting to find their ideal job or are preparing to undertake national professional examinations and many do not have immediate financial pressure placed on them by their families after graduation, given the nation’s low birth rate. In economic terms, this is known as frictional unemployment.
Given the high unemployment rate for new graduates, Premier Sean Chen (陳冲) has highlighted that several programs have been launched to create more job opportunities and increase resource allocation to fresh graduates including youth business start-up loan schemes and a farm rental program. The youth business start-up loan aims to assist and provide training to young people to help them start their own business in their home town, which could also potentially fill up more local job vacancies. The farm rental initiative, a Council of Agriculture project, helps young people who are interested in farming and agriculture to rent farms from landowners and give them support.
Meanwhile, surveys by the recruitment Web site 1111 Job Bank found that companies are less likely to recruit fresh graduates and this has gradually increased over time. Most jobs are largely open only to candidates with a certain level of experience or type of higher education degree.
Another recruitment agency, 104 Job Bank, has said that graduates from technical colleges are more likely to obtain job interviews than graduates from other institutions. The main reason is technology college students get specialist skills training which involves taking tests or programs for professional licenses and certificates during their school years.
China’s Taiwan Affairs Office has also announced that it will relax regulations on Taiwanese students and residents who want to work in China, which could cause a China-driven brain drain.
Given these challenges, the government should review its labor policy by taking into consideration the nation’s low birth rate and its aging population and launch reforms to upgrade industries. Taiwanese entrepreneurs, for their part, should consider building up a more comprehensive supply chain and bring to an end some of their costly and inefficient outsourcing to create more local job opportunities. Furthermore, in-school training and internship programs are needed to strengthen the abilities of young people to meet employers’ expectations, thus encouraging the latter to hire new graduates.
Cooperation between industry and universities could be another way to help young people enter the labor market, but the government needs to have relevant policies in place to protect these inexperienced youngsters from being exploited.
Gary Chen is a public relations officer and international affairs specialist at the Taiwan Institute of Economic Research.