Following the somewhat alarming reports by the Ministry of the Interior that the poverty gap in Taiwan is actually getting wider, and that the number of people officially classed as poor has risen, the Directorate-General of Budget, Accounting and Statistics (DGBAS) promptly released an economic growth forecast to mitigate the fallout. Nevertheless, the figures explicitly show that the government’s encouragement of atypical employment (work other than regular full-time employment) is actually directly contributing to the rise of a class of working poor, who are caught in the poverty trap. This development has implications for the future of Taiwan, as we enter the age of the working poor.
In Taiwan, atypical employment is directly responsible for the polarization of society. Statistics show, for example, that there is a 66-fold differential between the amount of money earned by the top 5 percent and the bottom 5 percent of income earners in Taiwan. Furthermore, we can no longer attribute this poverty to apathy or adverse circumstances (such as disability), as perhaps we could in the post-war period. The ministry’s figures show that of the 108,000 families classed as poor in Taiwan, 80,000 are impoverished because of low incomes resulting from unemployment or being in atypical employment.
The years when you could make your fortune through hard work are over, and it seems that, for some people, the more they work the worse off they are. For almost three-quarters of poor families, the reason for this is that their jobs are unstable, low-paid or dangerous — all common characteristics of the atypical employment they are pushed into. The longer they do this kind of work, the further into poverty they are driven and the harder they need to work just to get by. It is the classic poverty trap, a vicious circle that it is impossible to break away from.
We know from DGBAS figures released last year that there were already 687,000 people in atypical employment, such as temporary work or labor dispatch (interim) employment, and that almost 300,000 of these people were making less than what many would consider a basic wage. A survey conducted by Homeless of Taiwan and the Homeless Action Alliance showed that excessively low wage levels currently force many people into choosing between having enough to eat or having a roof over their heads. In some cases people are earning as little as NT$7,000 a month, all of which goes to the rent for a tiny room measuring barely 3.5m². For food they have to rely on charitable handouts.
Others spend the pittance they earn on food, living rough and constantly being moved on, always worried about their personal safety. The actual poverty situation in Taiwan has gone beyond the existence of low-income households living below the poverty line. We now also have homelessness, people living in basic accommodation, but not knowing where their next meal is coming from and a substantial group of atypical workers, who could fall into the aforementioned circumstances at any time.
Atypical employment not only causes extreme poverty, it also locks people into having to work into old age, unable to stagger out of the poverty trap. Figures published by the interior ministry show that the average annual income of people in the bottom 5 percent of earners in Taiwan is only NT$68,000, which equates to an average monthly wage of less than NT$6,000. It is almost inconceivable for many Taiwanese, and particularly those living in Taipei, that anyone could survive on such a figure.
However, anywhere you look you see people standing on the streets holding up advertising placards. This is just the kind of low-paid work we are referring to. Some even become ill from having to stand outside with the placards in atrocious weather. For many poor people this is actually a permanent job. In many cases this is only for two days a week (the weekends), eight hours of work per day, paying not even NT$700 a day — actually down from NT$900 previously paid for this kind of work. If you multiply the pay by eight days to get a monthly salary, the figure is barely NT$5,600.
It is also worth noting that the social demographics of poverty that we have become familiar with have evolved. In the past, the homeless were the old, the weak, the sick or the disabled. Nowadays, you see young people, people in the prime of their life — indeed whole families — on the streets.
A university graduate told of his experience working as a leaflet distributor. Every morning he would get up at the crack of dawn to pick up the leaflets for the day and would then hang around an agreed location, laden with the heavy fliers, handing them out to passersby. The working day was more than eight hours, and all this for a mere NT$800 a day. If he worked every day, without a break, he still would not make NT$20,000 a month.
We need to reassess our approach to this problem. The days when we were up to our eyeballs in easy money are gone, and it is no good returning to the way we approached the problem of poverty in the 1950s. We need a new approach, a new attitude.
Unfortunately, the present government clearly has no intention of changing the current flawed policies, and it is more interested in populist, short-term fixes. The interior ministry misleadingly claims that the perceived rise in the number of the poor is due to the greater amount of interest the government is taking in vulnerable groups; the DGBAS is trying the divert attention away from the issue by releasing rosy economic growth figures; and the Cabinet is content with lobbing the ball back into the court of social welfare organizations and the wealthy, asking them to make more financial contributions to society.
A short-term approach is not going to work. If the premier goes ahead with his policy of helping individuals find atypical employment, such as cleaning jobs, he is still going to enslave them in the vicious circle of the working poor and the poverty trap. If we are not very careful in how we deal with the issue of poverty, and if we fail to conduct a bold and honest review of the current policies, Taiwan could well go the way of Japan, which has seen two decades of decline.
Tai Yu-hui is a doctoral candidate at Southern Illinois University. Kuo Ying-ching is a convener of the Homeless Action Alliance.
TRANSLATED BY PAUL COOPER
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