Taiwan's growing unemployment is expected to rise further according to predictions from the Council of Labor Affairs (CLA, 勞委會) based on the government's most recent statistics.
According to the Directorate-General of Budget, Accounting and Statistics (DGBAS, 主計處), the national unemployment rate in August was 3.16 percent, higher than the average rate of 2.89 percent from January to August this year, while the number of unemployed was estimated as 311,000 for August.
DGBAS statistics show that unemployment has doubled over the past 10 years.
Adding to the unemployment problem is the rise in the average duration of unemployment to 22.5 weeks, almost six months.
Extended unemployment of this kind can significantly impact the incomes of families of the unemployed, according to the CLA's most recent report.
Before 1996, the unemployment rate had remained steady at about 1.6 percent.
Last year the overall unemployment rate, having been affected by the 921 earthquake and the Asian financial crisis, jumped to 2.9 percent, the highest since 1967.
Chen Chu (陳菊), chairwoman of the CLA, said the high unemployment was due to the country's poor economic situation.
She also said that the problem of structural unemployment had grown. Structural unemployment is brought about by changes to the economic structure and affects people who lack the skills to transfer to jobs in new industries.
Chen expected the unemployment problem to deepen because of the trend towards automated production, corporate mergers and acquisitions and the boom in knowledge-based industries.
To combat the problem, the CLA plans to promote vocational training and to seek to increase job opportunities in the public sector. Chen also said that reducing the number of foreign laborers would be among the council's primary policy objectives.
Wu Chung-chi (吳忠吉), professor of economics at National Taiwan University, predicted the unemployment problem would last for several more years, because, "Currently, unemployed people laid off by traditional industries, mostly male and classified as unskilled laborers, are incapable of working in the technical and service industries that are constantly developing on the island, since these require professional skills and [employers in this sector] tend to recruit women."
"Traditional industries are shrinking, because of the trend to embrace relatively capital- and technology-intensive industries. In addition, they just cannot compete with their Chinese and Southeast Asian counterparts which benefit from cheap labor costs," Wu said.
"These industries, therefore, either take on foreign laborers, whose wages are lower or transfer their businesses to places with cheaper labor costs. Only at the point at which companies no longer have any interest in moving overseas and the scale of such industries in Taiwan is ensured will the growing unemployment problem be eased," Wu said.
Wu said there is no cure for such unemployment at this stage. "Most of the current unemployed are poorly educated and unable to furnish themselves with the new skills and vocational training required for a new job," he said.
"As to reducing the number of foreign laborers, I think that will only push more labor-intensive industries out of the country to seek cheaper labor, which will not help unemployment among unskilled laborers," Wu said.
"But the ultimate solution to unemployment is to cultivate more professionals that are able to learn and fit in with the trends of industrial development," Wu said, echoing Chen's suggestion.
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