Taiwan is scrambling to raise its birth rate, among the world’s lowest, before the sinking number of newborns threatens productivity for its export-driven US$390 billion economy.
Taiwan fears it will lack the manpower or brainpower in 10 to 15 years to keep up with industrialized Asian peers and the blooming economies of some Southeast Asian countries.
A crude birth rate of 8.3 newborns per 1,000 people last year puts Taiwan above only Germany, Hong Kong, Italy and Japan, according to estimates by the CIA World Factbook. In comparison, Vietnam has a birth rate of 17.73 and Malaysia 22.24.
“Without a young generation, there’s no labor force, then you lose productivity,” said Hu Chung-ying (胡仲英), deputy minister of the Council for Economic Planning and Development. “It’s a very worrisome issue.”
Japan, despite a rate of 7.64, has soldiered on with automation and encouraging elders, women and foreigners to work. Asian peer Singapore has used baby bonuses for nine years to raise its rate, which was estimated at 8.82 last year.
Taiwan’s productivity would slide as retirees exceed new workers in the country of 23 million people unless citizens return en masse from abroad or more elderly seek jobs, economists say.
That would cripple Taiwan’s hard-fought efforts to compete with Hong Kong, Singapore and South Korea, all known for industrialization and fast growth from the 1960s to the 1990s.
Taiwanese are shunning births in favor of their careers, which often delays marriage or scraps the idea altogether, and to save child-rearing expenses that include babysitters and education from kindergarten to university.
“Women have changed. Women have expectations of a career,” said Linda Arrigo, a US-born university instructor in Taipei with a sociology background. “Women can’t handle a career with two-plus children.”
Housing prices are rising fast in parts of Taiwan while wages are stagnant, adding financial pressure to middle-class couples.
Sunny Yen, 42, is a typical case. She and her husband are middle-class white-collar workers in Taipei. They decided against a second child after realizing that their first would cost NT$20 million (US$630,000) to raise from diapers through to post-secondary graduation.
“If the financial burden were not so high, people might have more children,” Yen said. “The government needs to take more practical step-by-step measures.”
Officials can choose from a number of measures, drawing on examples in Europe, Australia and Asia. Choices include more time off, better access to childcare, government financial aid and offers of above-market wages to keep the elderly on the payroll.
Cities and counties in Taiwan will come up with subsidy packages for families with newborns, while the legislature considers a tax break plan, Hu said of the planning council.
Scholarships are in the works, Hu said, and more employers are providing nursing rooms for workers.
The Ministry of the Interior expects its budget for this year to cover the so-far-unknown cost of encouraging childbirths. If it needed more, Taiwan could set up a special budget or reallocate resources, said Tony Phoo (符銘財), an economist at Standard Chartered in Taipei.
In the longer term, Taiwan may allow more migrant labor, supplementing a foreign workforce of about 300,000, mostly from Southeast Asia, he said.
But first, a NT$1 million reward will go to whoever submits the best pro-baby slogan.
“If the birth rate keeps going down, the government has got to produce measures,” said Liang Kuo-yan (梁國源), president of the Polaris Research Institute in Taipei. “One, of course, is to encourage more births.”
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