Income gap widens in Taiwan due to pandemic
This was according to the 2020 Survey of Family Income and Expenditure conducted by the Directorate-General of Budget, Accounting and Statistics (DGBAS).
In addition, DGBAS data showed that although average household savings rose by a record annual 14.8% last year to NT$265,000 (US$9,475) since 1994, the income gap between rich and poor households widened.
The sharp rise in income inequality can be attributed to the fact that disadvantaged employees have been hit harder by the economic fallout from the COVID-19 pandemic, as many of them have been asked to take unpaid leave, for example, said Chu Tzer-ming, head of the DGBAS.
Also, the threat of new COVID-19 variants may adversely affect Taiwan’s job market this year, reducing the likelihood of a narrowing of income inequality, said Dachrahn Wu, director of the Research Center for Taiwan’s Economic Development at National Chengchi University.
After COVID-19 first spread to Taiwan in January 2020, it has since dealt a severe blow to the service industry, disrupted the country’s manufacturing operations and reduced consumer confidence, said the DGBAS.
The DGBAS survey also showed that average household spending in Taiwan fell by an annual 1.7% in 2020 to NT$815,000 (US$29,139), registering the biggest drop on record, according to Focus Taiwan.