An overhaul of the education system is due to reduce the stubbornly high unemployment rate and keep the country competitive. An ideal education system should have diverse functions and one of them should be developing and nurturing homegrown talent to support the development of local industries. In Taiwan, there are about 160 colleges, which generate 230,000 graduates each year, but local companies still find it difficult to recruit enough qualified workers.
At the beginning of this year, Hon Hai Precision Industry, which assembles iPhones and iPads for Apple Inc, launched a recruitment program to hire 3,000 software engineers for its new cloud-computing data center in Greater Kaohsiung, but only 300 vacancies have been filled.
Meanwhile, Taiwan’s unemployment rate has been at a relatively high level since the global financial meltdown caused by Lehman Brothers in 2008.
Five years later, the unemployment rate has improved to more than 4 percent on average from the peak of 5.85 percent on average in 2008. Yet the improvement stopped there, with the number of people out of a job remaining steady at about 480,000 in the first 10 months of this year.
The mismatch is again reflected in the latest survey released by international consultancy ManpowerGroup, which indicated that Taiwan’s employment outlook is the strongest in Asia. About 36 percent of the 1,080 companies surveyed plan to recruit new blood next quarter, up 3 percentage points from a quarter ago and up 5 percentage points from a year ago. Yet Taiwan’s jobless rate is expected to remain the highest among neighboring Asian countries.
“This shows that a talent shortage is the problem,” said Joan Yeh (葉朝蒂), operations director of temp business at ManpowerGroup Taiwan. “It means that jobseekers lack the skills and working experience that are required for the jobs.”
So the question this begs is: Do we need so many colleges? And, is the pool of college graduates equal to the pool of talent?
The answer is clear: Taiwan’s number of colleges is stunningly high compared with Singapore’s four and Hong Kong’s seven. Taiwan’s population is about five times Singapore’s 5 million people and three-and-a-half times Hong Kong’s 7 million. Yet the number of colleges in Taiwan is 40-fold and 23-fold that of Singapore and Hong Kong respectively.
Morris Chang (張忠謀), chairman of the world’s top contract chipmaker, Taiwan Semiconductor Manufacturing Co, last week shared his opinions about the nation’s educational system and provided his suggestions to the government.
Chang said that Taiwan does not need so many colleges. Doctorate degrees do not guarantee that the people who possess them have the ability to innovate, he said. However, Taiwan needs more vocational schools to train skilled workers, Chang said.
The nation’s industrial boom over the past decades was based on the vocational school system, as well as college eduction. The balance was tilted after most vocational schools scrambled to upgrade to colleges, as the government had encouraged them to do. That has inflated the number of colleges, but those “new” colleges are unable to offer useful programs and to produce high-quality graduates.
Chang is deeply concerned about Taiwan’s scarce talent pool and the future competitiveness of local industries.
Chang has good reason to be worried, since fewer young people are interested in entering the manufacturing industry. They no longer believe that higher education can provide better salaries or better careers because the monthly salary of most college graduates is capped at NT$22,000 and the jobless rate for local graduates with doctorates is 95 percent.
The government should take a serious look at this issue and reform the education system.
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