A compensation package for businesses that would struggle to implement next year’s increase in the minimum wage is to be announced at the end of this month, Minister of Economic Affairs Wang Mei-hua (王美花) told lawmakers on the legislature’s Economics Committee yesterday.
The Ministry of Economic Affairs (MOEA) and the Ministry of Labor are putting together a package that would compensate the businesses hardest hit by the 5 percent increase in the minimum wage, which goes into effect next year, Wang said.
“We understand that some businesses, especially those in the food and beverage sector, have been having a really tough time of late,” Wang said. “We are communicating with them so they do not have to worry; we will announce a compensation package by the end of the month.”
Photo: Tu Chien-jung, Taipei Times
While GDP growth in Taiwan is expected to exceed 6 percent this year, that growth is not evenly shared among sectors, the MOEA said.
Exports by the technology sector remained strong last year due to people working and learning from home, while the manufacturing sector has also rebounded strongly on the global recovery from COVID-19, but most domestic-focused firms, especially those in the retail and food and beverage sectors, were hit hard by a local outbreak of COVID-19 that started in the middle of May, the MOEA added.
The government has since July lowered the COVID-19 alert to level 2, which has allowed indoor dining to resume nationwide, but many have argued that some firms, especially small and medium-sized businesses, are too fragile to survive a hit from a wage increase.
The minimum monthly wage is to rise from NT$24,000 to NT$25,250 and the minimum hourly wage from NT$160 to NT$168 on Jan. 1 next year, the Ministry of Labor said last week.
The Quintuple Stimulus Voucher program, which provides every Taiwanese and permanent resident with NT$5,000 of vouchers to spend like cash, is expected to hasten the recovery, Wang said, adding that the MOEA would be paying close attention to the results.
“We have been told that firms want to structure the package like the stimulus program, using revenue contraction as a condition for government aid,” Wang said. “We will release the details once we have a workable plan.”
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