Taiwan's export orders fell to a record low last month and unemployment rose to a sixth straight high, signaling that the country's economic growth may have slowed to a halt last quarter.
Orders for Taiwan-made electronics and other exports fell 19.9 percent from a year earlier to US$11.2 billion after dropping 14 percent in May, the Ministry of Economic Affairs said. That amounted to the biggest drop since the government began compiling figures in 1981.
Industrial production fell 11.3 percent, compared with an 8.2 percent decline a month earlier.
Slowing economic growth in the US, Japan and Europe has seen companies such as Microsoft Corp and Samsung Electronics Co forecast that demand for computers won't rebound soon. That means Taiwanese makers of electronic components are getting fewer orders. Spending by consumers and businesses at home is too weak to keep growth on track.
Falling orders and production "doesn't suggest any segment of demand is offering support," said Paul Alapat, a regional economist at Nomura International (Hong Kong) Ltd.
Record unemployment, paired with a decline in the stock market to near an eight-year low, means domestic demand isn't taking up the slack.
Taiwan's jobless rate last month hit a new high of 4.51 percent as recent graduates began looking for jobs amid the slowdown, officials said yesterday. That's the highest since the government began compiling figures in 1978.
The figure was up from the previous high of 4.22 percent in May and sharply higher from 2.89 percent a year earlier, the Directorate General of Budget, Accounting and Statistics said.
The directorate said 442,000 people were out of work in June, a rise of 31,000 from a month earlier, as graduates started joining the job market, which was already depressed by increasing business closures and lay-offs.
The jobless rate was expected to keep rising until September, and the full-year rate will exceed 4 percent, said Chen Jin-cherng (陳金城), deputy director of the statistics agency's census department.
"If this were cyclical, when the cycle turns, the jobs would come back," Alapat said. "The worry that some of these jobs may never come back is what's causing a lot of nervousness."
The drop in export orders, an indicator for shipments in two to three months, suggest Taiwan's economy may not start to rebound until the fourth quarter.
RSS