According to the latest data released by Taiwan's Directorate-General of Budget, Accounting and Statistics (DGBAS), the country's job vacancy rate has dropped to a record low of 2.57% in the first half of 2023, indicating the impact of global economic conditions on the local job market. The manufacturing sector has witnessed the most significant decline in job vacancies, while employer willingness for salary increases has also diminished.
The DGBAS conducts a biannual survey in February and August to gauge the employment status of business establishments. The survey reflects the changes in labor demand during the first and second halves of the year, providing insights into job vacancies and employment opportunities. The survey for the first half of this year reveals that the job vacancy rate in the industrial and service sectors has decreased to 2.57%, the lowest level in the past 13 years.
Table shows a summary of the job vacancy rates in different sectors over the past four years and demonstrates a decreasing trend in job vacancy rates in Taiwan over the past few years, with a significant reduction observed in the manufacturing sector.
| Feb 2020 | Feb 2021 | Feb 2022 | Mar 2023 | |
|---|---|---|---|---|
| Overall Job Vacancy Rate | 2.66 | 3.19 | 3.07 | 2.57 |
| Manufacturing Sector Job Vacancy Rate | 2.81 | 3.59 | 3.60 | 2.65 |
| Construction Industry Job Vacancy Rate | 2.34 | 5.98 | 4.97 | 3.01 |
| Wholesale and Retail Trade Job Vacancy Rate | 2.02 | 1.78 | 1.93 | 2.03 |
Note: The data sources from the Directorate-General of Budget, Accounting and Statistics (DGBAS).
The data indicates that Taiwan's job market has been impacted by the global economic slowdown, leading to a conservative approach towards hiring by employers. The decline in job vacancies in the manufacturing sector is primarily driven by weakened end-market demand. Conversely, the service sector has shown relative improvement, indicating stronger employment opportunities.
The manufacturing sector has experienced a significant decline in job vacancies, with nearly 30,000 fewer positions compared to the previous year. This decline can be attributed to the global economic slowdown and weakened end-market demand. Among manufacturing sub-industries, the electronic component manufacturing industry, particularly in the semiconductor sector, has witnessed the largest reduction in job vacancies, with over 9,000 positions eliminated. The construction industry has also been affected, primarily due to interest rate hikes and amendments to the Average Land Price Act, resulting in increased construction costs and reduced project volume.
However, the service sector has shown a relatively more favorable trend. With the easing of the pandemic situation and increased consumer activity, job vacancies in the domestic-demand-driven service industry have shown an upward trend in the first half of this year. Job vacancies in the wholesale and retail trade, accommodation and food services, leisure services, and other service sectors have all increased compared to the same period last year. The job vacancy rate in the wholesale and retail trade sector has exceeded 2%, and the accommodation and food services sector has surpassed 3%, reaching their highest levels in nearly four years.
The reduction in job vacancies can be attributed to the overall economic slowdown, leading to cautious hiring practices by employers. The manufacturing sector, in particular, has been affected by weakened end-market demand, while the construction industry has faced constraints due to policy changes and increased costs. On the other hand, the decline in employer willingness for salary increases reflects the impact of the economic downturn. According to the DGBAS, only 28.2% of employers are expected to implement salary increases this year, marking the lowest percentage in the past three years.
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