In spite of lower-than-expected growth in the first quarter, the government has no plan to reverse the increases in the minimum wage made at the beginning of last month, Premier Jiang Yi-huah (江宜樺) said yesterday.
“We won’t change the stated policy that has raised the minimum wage” even after the first-quarter GDP data is finalized this month, Jiang said.
He decided on April 2 to increase the minimum wage by 1.42 percent, from NT$18,780 to NT$19,047 effective April 1, after confirming with the Directorate-Generate of Budget, Accounting and Statistics (DGBAS) that first-quarter GDP growth had exceeded 3 percent.
A GDP growth of more than 3 percent for two quarters in a row or an unemployment rate of less than 4 percent for two consecutive months were the conditions set by the Cabinet to increase the monthly minimum wage.
GDP growth in the fourth quarter of last year was 3.72 percent.
The DGBAS yesterday said the advance estimate of first-quarter GDP could be lower than the estimate of 3.26 percent made in February, falling to 1.54 percent because of weak exports.
Jiang said other countries such as Singapore and South Korea had also revised their first-quarter GDP forecasts downwards.
That meant that the European debt crisis was still hurting the world economy, he said.
The adjustment came because exports were not as good as expected and domestic private consumption contributed less to economic growth than expected, Jiang said.
However, the Executive Yuan had decided to maintain the wage increase to “reward” workers who have contributed so much to the country for years, he said.
Other economic indicators have showed signs of recovery, he said, such as the latest consumer confidence index, which increased 1.28 points to 77.29 last month, from 76.01 in March. That showed that most people in Taiwan had a positive outlook on the economy.
The 17 percent rebound in imports of capital equipment in the first quarter and exports in March that hit a 20-month high were also positive signs, he said.
Those figures showed that the economy is turning around, Jiang said, adding the public should have confidence to keep the momentum in domestic consumption going.