7. Taiwan’s Economic Landscape

7.3. Evaluation Factors on Dynamics

7.3.3. Wage Factor

Wage indicates how well people are doing. Not all clusters have the same average wages.

Some clusters require more technical skills that drive a higher wage. The most desirable cluster is the highly specialized, high wage, and largely agglomerated clusters, such as Italian, shoes, French wine, Silicon Valley’s high-tech and Taiwan’s IT clusters. Wage is also a strong indicator of manpower supply. When there is an oversupply of manpower, that will forbid wages to rise due to employment competition. Often there is spillover

Local Food and 

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effects from one cluster to another cluster, providing more opportunities for job change and wage gain (Glaeser et al., 1991), but wage gain is not the same as the business gain.

Business gain can trigger the wage to rise due to shortage of manpower either by fast growing cluster with higher labor demand, or there are new technological innovations require different set of skills to fulfill the job. The average wage here is calculated by taking calculating the CAGR from the wages of 2006 to the wages of 2011. Below is Taiwan’s average wage ranking of Traded clusters and Local clusters.

Figure 43 Annual Wage Ranking of Taiwan’s Traded Clusters.

Source: Taiwan National Statistics Bureau

0 200 400 600 800 1000 1200 1400 1600 Agricultural Inputs and ServicesCoal Mining

Electric Power Generation and TransmissionEducation and Knowledge CreationAerospace Vehicles and DefenseLeather and Related ProductsDownstream Metal ProductsJewelry and Precious MetalsFishing and Fishing ProductsMusic and Sound RecordingMetalworking TechnologyHospitality and TourismTextile ManufacturingLivestock ProcessingNonmetal MiningPrinting ServicesMedical DevicesPerforming ArtsWood ProductsMetal MiningFurnitureForestryTobaccoApparel Production Technology and Heavy MachineryOil and Gas Production and TransportationCommunications Equipment and ServicesTrailers, Motor Homes, and AppliancesInformation Technology and Analytical…Distribution and Electronic CommerceRecreational and Small Electric GoodsFood Processing and ManufacturingConstruction Products and ServicesVideo Production and DistributionMarketing, Design, and PublishingLighting and Electrical EquipmentDownstream Chemical ProductsUpstream Metal ManufacturingVulcanized and Fired MaterialsUpstream Chemical ProductsTransportation and LogisticsEnvironmental ServicesWater TransportationPaper and PackagingBiopharmaceuticalsInsurance ServicesFinancial ServicesBusiness ServicesAutomotiveFootwearPlastics

Annual Wage Ranking of Taiwan's Traded Clusters (in  NT$ K), 2011

The average wage is 597K in Traded  Clusters.

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Top paid Traded Clusters are:

1. Oil and Gas Production and Transportation 2. Upstream Chemical Products, Financial Services 3. Financial Services

4. Communication Equipment and Services

5. Information Technology and Analytical Equipment 6. Water Transportation

7. Environmental Services 8. Biopharmaceuticals

9. Trailers, Motor Homes, and Appliances 10. Downstream Chemical Products

Figure 44 Average Annual Wage of Taiwan’s Local Clusters.

The top 3 Local paid clusters are:

1.Local Logistical Services

2.Local Utilities 3.Local Industrial products and Services

Source: Taiwan National Statistics Bureau

The average wage between Traded and Local clusters are not that far apart. Taiwan has a GINI factor of 33.8 (2012s)30F30F31 which explains short gap. The Traded Clusters with better and above average pays are Oil and Gas Production and Transportation, Upstream

Chemical Products, Financial Services, Communication Equipment Services, Information

31 https://en.wikipedia.org/wiki/List_of_countries_by_income_equality

0 200 400 600 800 1000 1200 1400 Local Education and Training

Local Household Goods and Services Local Retailing of Clothing and…

Local Food and Beverage Processing…

Local Motor Vehicle Products and…

Local Industrial Products and Services Local Utilities Local Logistical Services

2011 Average Wage in Taiwan's Local  Clusters (in NT$k)

The average wage  is 551K for Local  Clusters.

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Technology and Analytical Instruments, Water Transportation, Insurance Services, Transportation and Logistics, Environmental Services, Biopharmaceutical, Trailers Motor Homes and Appliances, Downstream Chemical Products, and Marketing Design and Publishing. The Local Clusters with better and above average pay are Local the Financial Services, Local Logistical Services, Local Health Services, Local Utilities, Local

Entertainment and Media, and Local Industrial Products and Services.

How have these clusters weathered through the financial crisis? The three top-paid clusters are Oil and Gas Production and Transportation, Local Financial Services, and Upstream Chemical Products respectively, and they are all smaller clusters of less than 2% of all workforce. Two faster growing Traded Clusters are Upstream Metal

Manufacturing and Metal Working Technology, and these clusters are 2% or more. The three most noticeable declining clusters (highlighted in red in Figure 47 Taiwan’s Cluster Composition are Distribution and Electronic Commerce, Transportation Logistics, and Downstream Metal Products with losing momentum after the 2008 financial crisis. The largest cluster of Distribution and Electronic Commerce of 10.09% employment shares are losing 0.61% of the employments over 5 years during the financial crisis going.

Wages depends on the revenue throughput and labor supply pool to determine its ups and downs. Cities’ wage differences can tell how productive the region is. The higher wages normally demand for more knowledge or skills; therefore, job training is important for the supply of labor pool. The Hsinchu Science Park has two first-class Universities nearby with a government supported research institute to supply the knowledge training, and there are vocational colleges nearby the cities that contributes to the technician level of job workers for mass production’s labor supply.

The middle management for the knowledge intensive industry is crucially important because the managers not only have to manage the production process, they also have to understand the nature of the technology and how to apply the best production equipment for the mass production. Lots of tuning needs to be done when a design in transferred into production floor. Taiwan’s OEMs win on modulized-production equipment. For a new designed electronic consumer product, normally takes minimum a year to design and test out the production line, it can take Taiwan’s OEM three months to modify a production

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to retrofit the line into a newly functional production line, and it does not tolerate the production quality and testing. This production strategy without the knowledge of

Production Technology and Heavy Equipment cannot be easily done. Part of Taiwan’s IT success is built on this production strategy. On wage composition among cities:

Figure 45 Taiwan’s Wage Growth by the Cities.

Source: Taiwan National Statistics Bureau

Hsinchu City ranks the highest pay and growth cities among all. The Hsinchu Science Park, two first-class Universities, and a semi-government research center provided the

New Tapei Taipei

Taichung City

Tainan City Kaohsiung City

Yilan County

Taoyuan County Hsinchu County

Miaoli County

Changhua County

Nantou County

Yunlin County Chiayi County

Pingtung County Taitung County

Hualien County

Penghu County

Keelung City

Hsinchu City

Chiayi City Kinmen County

Lienchiang County

300 400 500 600 700 800 900

‐2% ‐1% 0% 1% 2% 3% 4% 5% 6%

Average CitWages in NT$ 1,000, 2011

Wage Growth by Cities, 2006‐2011, bubble= employment size

Taiwan's Wage Growth By Cities, CAGR 2006‐2011

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excellent business environment for the success of knowledge-intensive IT Cluster.

Different from the Silicon Valley high-tech cluster, Hsinchu cluster provides the

knowledge and research on Production Technology and high-skill trained labor to support Silicon Valley’s innovative designs for consumer markets. The customers for Hsinchu are high-tech product designers, and Silicon Valley’s customers are electronic consumers.

The worst wage declining is in Kaohsiung City with fairly sizable employment raking the 4th. Changhua is another city of a concern with its employment size and wages decline. It is worth looking more deeply into why Kaohsiung and Changhua is taking a toll on wage decline. What clustered industries primarily drives these areas and compared to the world trade data to see what other areas are rising? Taiwan overall, the North region is stable on all three growths. Taitung and Pintung need more attention to find out why it did not resist the external shock. Tainan is doing very well on all three growths, and this is worth to see what is the competitive advantage to be agglomerated. Miaoli obviously enjoyed the Hsinchu’s spillovers.

在文檔中 台灣經濟形貌: 增進公共政策效益之動態群聚模式 - 政大學術集成 (頁 95-100)