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Morris Chang: Without talent, Taiwan’s economy is cooked
Taiwan News, Staff Writer
2014-01-23 10:10 AM
Morris Chang, the chairman of Taiwan’s leading foundry TSMC, told the Commonwealth Economic Forum (CWEF) Wednesday that Taiwan’s economy is sick and disorganized and that much of the trouble is due to personnel issues. He warned that without the talent needed to staff companies like his own it is futile to talk about innovation as a means for ‘saving the economy. He added that he fears it will take a whole generation of effort to resolve the talent crisis, saying the only way to solve it quickly is to bring in talent from abroad.

Chang told the WEF delegates that Taiwan has fallen into a vicious cycle in which a lack of development means products with low added value, leading in turn to thin gross profit margins and on to lack of funds for R&D. He said it becomes a "chicken or the egg" problem that defies easy solutions and works inexorably to stifle economic growth.

Professor Hsing Ping-lung of National Taiwan University’s Institute of National Development agreed with Chang’s assessment, pointing out that if businesses continue to concentrate on reducing their costs and ignore the need for transformation and upgrading, and if they are only willing to pay salaries of NT$30,000, it will be impossible for them to attract and retain real talent. If, on the other hand, a business is forward-looking and aware of the need to invest in its personnel as well as its facilities, capable employees will find their way to its doors. In short, the importance of the enterprise and its vision in determining success or failure cannot be ignored.

Chang picked up the thread, saying that experts keep stressing that enterprises should upgrade their technology and facilities to enhance their competitiveness, advice that has almost become a mantra in some industries. But these experts are not putting enough emphasis on the need for talent, he said. One major factor in the talent crisis has been the rise of China, which means that now the two sides of the strait are competing against each other to grab talent.

Chang attributed the lack of talent to a mismatch between industry and academia that has led to an imbalance in supply and demand. The island’s industries are woefully short of talent with 10 to 20 years of work experience, creative minds and self-motivated personalities who will be loyal to their employers. Without this sort of employees, he said, it is useless to talk about innovation and creativity. He added that this lack of knowledge and ability can be seen in the worlds of both business and government in Taiwan.

Chang said that at least 10 years to a whole generation of effort will be needed to resolve the lack of talented personnel and strengthen the competitiveness of local industries. The fastest way to acquire needed talent, he said, would be to loosen the restrictions on bringing in talent from abroad. He noted that former Chinese leader Deng Xiaoping opened up opportunities for talent, capital and technology through much-needed reforms, The only thing he did not open up was the political system. In Taiwan, said Chang, ironically it has been the other way around: the political system has been turned upside down, but nothing else has changed.

Here Professor Hsing demurred, saying he believes that the shortage of high-level personnel in Taiwan is somewhat over-exaggerated. He maintained that restrictions on using foreign talent are not that serious in Taiwan, and the real problem is that Taiwan's business owners are either unwilling or unable to pay salaries high enough to recruit real talent.

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