On wages, business leaders urge respect for market mechanism

2018/05/14 20:02:16 fontsize-small fontsize-default fontsize-big
On wages, business leaders urge respect for market mechanism

Taipei, May 14 (CNA) The leaders of two major Taiwanese business associations urged the government to respect the market mechanism and the management autonomy of companies as it tries to promote wage growth.

"I believe (wages) will rise naturally if the government focuses more on economic stimulus plans and tries harder to devise good (economic) policies," said General Chamber of Commerce Chairman Lai Cheng-yi (賴正鎰) on Monday.

He was responding to strategies proposed by the Cabinet earlier in the day to fix the country's low-wage problem.

The strategies, aimed at increasing the wages of low-paid workers, included hiking the minimum pay for government employees to NT$30,000 (US$1,000) a month, encouraging or pressing private firms to follow suit, and raising the hourly minimum wage from NT$140 to NT$150.

At a press conference Monday, Vice Premier Shih Jun-ji (施俊吉) described raising the hourly wage rate as a "quick and efficient short-term step" to resolve the low-wage problem.

Lai said, however, that "this isn't a case of the government simply throwing out numbers and then [wages] will move higher. I don't think this can work."

Also, wage levels in the services sector are not as low as the government thinks they are, he said, arguing that the private sector is aware that it cannot hire people with low-wage offers.

"The market mechanism will regulate the wage structure. There's no need for the government to worry too much," he said.

Echoing Lai, Taipei-based Chinese National Association of Industry and Commerce Chairman Lin Por-fong (林伯豐) said improving the investment environment is what the government should set as its top priority.

"When the economic climate is promising, the rest will automatically take a turn for the better," Lin contended.

He urged the government to allow enterprises to run their own companies freely.

"Every company has its own management approach," he said. "If the government interferes in this and that and demands a bunch of things it itself cannot achieve, it will only intensify conflict between management and labor."

In that scenario, some companies may end up having to reduce the number of employees they have or even close down, let alone raise wages, Lin warned.

Both Lai and Lin voiced support for the government to take the initiative to raise the wages of low-paid contract workers in the public sector, but they stressed that striving for economic growth is the fundamental solution.

Wages in Taiwan have remained relatively stagnant when inflation is factored in after being driven down during the 2008-2009 financial crisis.

Average real monthly earnings, which include irregular income such as overtime and bonuses and are adjusted for inflation, rose to an all-time first-quarter high of NT$59,852, but that was still only 2.4 percent higher than the real monthly earnings of NT$58,447 in the first quarter of 2000.

Real monthly salaries hit NT$38,132 in the first quarter, lower than in the same quarter in the years from 2001 to 2007, before the financial crisis hit.

(By Pan Tzu-yu and Elizabeth Hsu)
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