How much TW newbie get for starting salary?
*This is an article written by the author in his Korean blog on Oct. 2017 and is edited and translated into English for greater audience.
Prologue: Wasn’t Taiwan a well-off country?
I first remember the time when I got to know about the salary level of Taiwanese employees. Excuse my expression but I thought there must be a ‘0’ missing in the digit.
That was how shocking it was. Period.
Ever since, it lingered in my head. Why in the world Taiwanese get so little for their worth of labor? I mean, c’mon. Taiwan, after all, was one of the notorious Asian tigers — alongside with South Korea, Hong Kong and Singapore.
Since I have relative more knowledge and experience with Korea and Taiwan in this occasion, let’s take these two tigers and compare!
Korea and Taiwan — heterogeneous twins
As I got to know more about Taiwan, I found so many subtle similarities between the two. Let me just list them out.
- Their modernization heavily influenced by imperialist Japan
- Civil war with communist side and de facto divided into two different regimes
- Due to the above status, every man has to serve in military
- Both are islands — one natural, the other virtual as South Koreans only way abroad is via ship or airplane due to the North
- As mentioned, both enjoyed robust economic growth as the Asian tigers
- Both have cutting edge technologies in IT industry, namely in semiconductors
But until been told of these facts, few will recognize the similarities and rather focus on seeming differences. And when it comes to differences, I would like to point out to their respective popularity. Let’s see the buzzword for words ‘Korea’ and ‘Taiwan’ on Google Trend in the past one year.
It showed that ‘Korea’ had been searched 6 times more frequently than ‘Taiwan’ in average. And it is also not difficult to see in almost all regions of the world, ‘Korea’ was the bigger trend.
They share similar traits in terms of history and environment. But one is much more popular than the other in keyword with many other differences.
Why Taiwan became “less popular” or has seemingly grown at different pace?
My quick thoughts:
- Limitation in country brand — whereas North Korea became isolated, China now dominates Taiwan in just about every aspect of military/politics/economy. As Taiwan “cannot” be officially recognized as a normal country by nearly 90% of the sovereign states (due to the “big brother”), it is virtually non-existent in world diplomacy. (For example, here) Not to mention that it cannot use its official name and flag in international events. This results in low coverage of its identity or its brand.
- Limitation in its company brand — Samsung, LG, Hyundai.. some of the Korean brands you might have heard. They once used to be either the copycats or dust eaters in oversea retail stores in the 80–90s. But with the strong R&D and the ensuing brand marketing, they became the global brands. Whereas, Taiwan also has some big brands like Honghai (or rather known for Foxconn) or TSMC but they focus on OEM engendering less popularity among global consumers.
- Limitation in its pop culture influence — although Mandarin Chinese is a huge advantage when you think about the huge Chinese-speaking diaspora in the world (known as 華僑), Taiwanese pop contents usually struggle to transcend this community. Meanwhile, despite its relative language or cultural disadvantage that only North Koreans and ethnic Koreans in Manchuria speak Korean, the so-called “K-pop” and other cultural contents have successfully spread throughout Asia and some parts of the world. (I have talked about why this gap in cultural influence widened in a separate article years ago.)
Let’s admit. Taiwan was in tougher battle against the bigger counterpart. But aside from that, there were lots of other factors that caused these differences. (I will get into those later.)
Anyway, I just gave you some brief overview of these two tigers in the hopes of helping understand the background. Now, let’s get back into the point.
So how much does TW newbies get for starting salary?
As you see from the graph below, the nominal GDP of Korea and Taiwan are not too far apart at $22k and $27k, Korea higher only by 1.2x.
However, if you compare the fresh-out-of-school’s average annual salaries, it’s a bit shocking. 11k vs 32k, almost 3x difference!
Another part worth noticing is that the difference between GDP per capita and the starting annual salary. It means the newbie get only half of the avg. GDP in Taiwan while 17%p more than avg. in Korea.
What do you think about this number?
You graduate from a decent 4-year college, find a job and you earn less than $1,000 a month. To verify the numbers, I have looked into multiple sources, but the range seemed to be in the ballpark. (Also, there was once a term “22k” to signify the social issue of the low starting salary in a cynical way.)
Let’s look at this graph.
The monthly salary of the newbie is lower than 20 years ago!! Is this even possible? There has to be something wrong. It seems like something that can happen in an economy like deflation-swept Japan.
I had to confront these numbers with a bit of alertness. In my old memory, Taiwan was remembered as once a rich country like Hong Kong and I am sure it was richer in terms of life quality than Korea till probably mid-80s. But after three decades, the starting salary difference has widened to three times!
What made these differences?
I will get into whys in the following article.
