Wed, Dec 03, 2008 - Page 2 News List

Layoffs may exceed hirings in Q1

By Shelley Huang  /  STAFF REPORTER

More people are expected to be laid off than hired in the first quarter of next year, a survey released by the Council of Labor Affairs (CLA) showed.

In the poll of 3,076 businesses with at least 30 employees, employers were asked how many workers they were planning to hire or lay off in the first quarter of next year.

The number of workers that companies said they intended to hire in the next quarter amounted to 21,071 people, but with companies planning to lay off 26,632 workers, the net projected demand was less than zero for the first time in the survey’s two-year history.

In the survey, released yesterday, the main reasons that businesses gave for laying off workers were “scaling back operations” and “personnel cutbacks,” Statistics Department director Chen Jin-cherng (陳金城) said.

The average business planned to lay off 13 employees, or an average 7.53 percent of its total workforce. Compared with this quarter, with each business laying off an average of 11 employees, or 6.33 percent of its workforce, the trend is worsening, Chen said.

Chen said the larger the company, the larger the scale of the layoffs. This quarter, companies with more than 500 employees saw a net change in employees of minus 8,266.

While many full-time employees were being laid off, the number of part-time employees has increased, Chen said.

The projected net change in full-time employees for next quarter was minus 2,510, while part-time employees were expected to increase by 1,541 people.

“This is perhaps because many companies are laying off full-time employees and replacing them with part-time employees to cut costs,” Chen said.

When compared across industries, companies in the manufacturing and construction sectors were planning the most layoffs, while companies in retail, hotel, restaurants and security saw net increases.

Because the first quarter is typically the peak season for department and retail stores, the retail industry expects greater demand, Chen said. The need for security guards has also risen, he said.

When compared across occupations, low-skilled workers, manual labor and machinery operators saw the greatest decreases, while salespeople and professionals saw net increases, Chen said.

Generally, businesses have a bleak outlook for the next few months, he said.

Meanwhile, the Democratic Progressive Party (DPP) caucus yesterday asked the government to support the country’s small and medium enterprises to combat the rising unemployment rate.

DPP legislative caucus whip William Lai (賴清德) told a press conference that statistics released by the Financial Supervisory Commission indicated that domestic banks had been granting fewer loans to small and medium enterprises, while demanding that companies repay existing loans, which could negatively affect the financial situations of such companies amid the global financial crisis.

He said the government should urge domestic banks not to tighten the money supply for small and medium businesses.

In addition, Lai said that a National Development Fund budget report showed the government was allowing large enterprises to take loans from the fund, but neglecting small and medium enterprises.

He said it was a policy mistake for the government to put more resources into big business while ignoring small businesses.

Additional reporting by Rich Chang

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