But reaching a milestone in raw population figures can prompt broad reevaluation of population policies, and this occurred in July when Taiwan's population reached the 20 million mark. The event prompted demographers, sociologists, and economists to flood the media with analyses of the island's changing population. Their goal was to encourage policy-makers to pay closer attention to the influences an expanding population can have on the long-term health of the island.
One of these scholars, Dr. Chen Kuan-cheng, a demographer and a research fellow at Academia Sinica, is especially concerned about Taiwan's population growth in the context of economic development. "The absolute number of 20 million has no demographic meaning without being related to characteristics such as the structure and distribution of the population and the natural resources of Taiwan," he says.
Chen urges paying more attention to other population statistics. Although the government's family planning policy over the past two decades has been fairly successful in helping slow the island's overall population growth, Chen says that at the current natural increase rate of 11 per 1,000 persons, "Taiwan's population growth will not stop for the next 30 to 40 years." If true, the island's population would reach 25 million by the year 2030.
But does this figure indicate overpopulation? The answer comes from looking at other statistics, such as those concerning birth and death rates, life expectancies, sex ratios, and replacement rates. The last is of crucial importance in analyzing population structure. Replacement rates are comprised of the "net reproduction rate" and the "joint reproduction rate." Demographers define the former as the average number of daughters a woman gives birth to during her childbearing years (usually computed between ages 15 and 49). The latter rate refers to the number of live sons and daughters born per each male and female (at reproductive ages) in the total population.
These terms assist understanding of a major challenge to Taiwan's social and economic well-being—what experts call an "aging population." This is one of the less obvious effects of population change, and most local residents did not know of the concept until quite recently. Chen explains the current demographic trend: "The present working population will retire in 30 to 40 years, so the estimated retirement ratio in the year 2024 will be 25 percent of the population. The ratio was only 8.73 percent in 1984; furthermore, the current reproduction rate is below replacement rate."
This means that by the year 2024, every four working members of the population will have to support one retired person. Added to this burden will be the portion of young people in school (which currently comprises the bulk of the dependent population), further compounding the social and economic problems. Simply stated, Taiwan is evolving into what population experts call a "typical geriatric society." Such a population structure places heavy social burdens on the working population, and has great potential for retarding economic development.
"The present net reproduction rate is close to 0.7841 and the joint reproduction rate is about 1.70," Chen explains. "If the rates remain unchanged, after two generations the former will deteriorate to 0.6148. At that point, the reduced number of young people will affect the labor supply and threaten future economic growth."
The current net reproduction rate indicates that roughly two daughters are produced by every three women. If this rate remains unchanged, the number of daughters produced by the daughters of the current reproductive generation will drop even further—to approximately one daughter produced by every two women. Thus, with each successive generation, there will be fewer potential mothers.
In brief, when the net reproduction rate is less than one, and the joint reproduction rate is less than two, demographers say a population is exhibiting retrogressive reproductive behavior, which leads to an aging population. Such is the case in Taiwan.
While some observers say this is an inevitable result of an effective birth control policy—and is a trend that can lead to future labor shortages—family planning is in fact only a part of the reason for declining birth rates in Taiwan. Chen suggests that the real cause of the population decline lies in other areas. In the first decade of this century, for example, when the death rate remained stable at about 45 per 1,000 persons, the population loss was offset by births. But while the death rate started to decline in the 1920s due to improvements in medical care and better sanitation, the birth rate did not begin declining until 1951. The death rate during the 1920s actually fell to five per 1,000 persons. Moreover, infant mortality declined from the 1920s to the 1950s, generating a "baby boom" well before 1951.
Taiwan did not have any formal family planning policy until 1981—a fact often overlooked. Therefore, the reduction in births was a natural trend rather than an artificial measure imposed by the government. People no longer needed to produce "extra" babies as a hedge against child deaths, as in previous times, and the island's declining agricultural sector made it less necessary for families to produce more children in order to have additional working hands at home and in the fields. The growth of an urban life-style and expanding opportunities for education also tended to limit the size of families.
Social attitudes have therefore undergone a reversal in the past three decades from a "more-children-the-better" ideology to one that views large numbers of children as a burden, indicating that population dynamics involves much more than simple growth figures. "The public must be more aware of the situation if it is to work with the government in planning for the future," Chen says. "Although the government has no intention of drastically changing the direction of its birth control policy, people should acknowledge the coming of a geriatric era. Forty years are comparatively short in the long history of humanity, but in the next three or four decades we will have to face all sorts of problems. There are no quick fixes."
Manpower Planning Department Director Chang Pei-chi—"With a slightly inadequate labor supply, this is a golden opportunity to upgrade Taiwan's Industries. "
Chang Pei-chi, director of the ROC's Manpower Planning Department, Council for Economic Planning and Development, is more upbeat about Taiwan's demographic future, even if changes bring a decline in the size of the labor pool.
"I'm optimistic about the future of our aging population, and I think that further increasing the population density would just worsen the quality of life," he says. "With a slightly inadequate labor supply, this is a golden opportunity to upgrade Taiwan's industries. By being subjected to the market's supply and demand mechanism, the problems of an insufficient labor force and the need for industrial upgrading could work hand-in-hand to create a stronger economy."
A smaller labor pool could in fact act as an incentive for entrepreneurs to modernize their operations. Such innovations in the industrial structure are rarely easy to implement, no matter how rational they might be in theory, and a labor shortage could force the transformation. Thus far, Taiwan's entrepreneurs have generally been reluctant to implement innovative managerial and technical restructuring, especially since such moves are expensive and entail high risk. But if the availability and cost of labor continue to be problems, local businessmen may have limited alternatives to upgrading their operations.
"Taiwan used to have the reputation of possessing an unlimited labor pool, but this was not necessarily good," Chang says. "It implies an impoverished economic condition in which a society has scarce capital, an underdeveloped industrial sector, low GNP, low personal income, a low standard of living, and a deficient welfare system." Chang adds that as a result of Taiwan's so-called economic miracle, most of these conditions are being overcome, especially as personal incomes are expected to average US$18,000 to US$20,000 by the year 2000.
Current changes in labor requirements already indicate that Taiwan is moving rapidly toward a post-industrial society, with low-value, labor-intensive industries giving way to high-tech and service industries. In the past three decades, the government supported industrial growth with primary production, land reform (through the Land-to-the-Tiller Program), protection of farmers from foreign competition, and gradual mechanization of agriculture while expanding the industrial sector. The result was a steady shift of the population into the cities, where job opportunities were expanding. Industrial growth was further assisted by a broad-based vocational education system that created the skilled labor pool so crucial to economic development and higher productivity.
But industrialization has now reached a crucial turning point. Manpower is a more precious resource, and higher technical education and automation are necessary to help meet the new labor requirements. As the government encourages industrial upgrading, it is keeping a lid on the use of imported unskilled labor, since excessive employment of such workers would encourage labor-intensive industries to postpone their restructuring.
A tense moment as residents (top) search for their names following a public drawing from applications (bottom) for low-cost government housing.
Because high-tech industries consume less energy, create less pollution, and produce more high value-added goods, Chang sees no need to mourn the disappearance of sweatshop factories or non-lucrative agricultural ventures. "The obvious trend today is toward a loose division of labor throughout the world," he says. "Taiwan has a typical island economy which depends on foreign trade, so the idea of self-subsistence shouldn't be used as an excuse to protect the economy against foreign imports."
Because of Taiwan's dependence on trade, international conditions can have major impact on internal affairs. As the domestic market has become more liberalized and additional trade barriers lifted, there has been a marked surge in local consumerism. The rise in consumption has in turn produced an expansion in the service sector. The higher wages for employees in service industries have prompted considerable expansion of the sector in recent years. "In the past, most larger firms or enterprises set up their own advertising and cargo service departments," Chang explains. "But most of those companies have now eliminated these departments and have contracted the work out to specialized and more efficient service firms. Functional differentiation of the secondary and services sectors were unavoidable."
Since service industries require higher skills, the existing labor force is having difficulties meeting the educational requirements of employers. "But female workers can help reduce the strain on labor requirements," Chang says. "Since educational opportunities are equal for both sexes, the division of labor is based on brainpower instead of physical prowess, so the sex roles in jobs have been blurred. Females are already in a more advantageous position in the labor market than they were previously."
Despite these optimistic assessments, Chang is worried about Taiwan's consumption boom: "Service sector firms are the fastest growing part of the marketplace. Since these are consumption-oriented, their productivity and wage rates still remain rather low. Experience shows that a country with a prosperous service sector usually has high unemployment rates as well. As Taiwan moves from agricultural to industrial production, and then to services, the flow of the labor force will naturally follow the same path."
Good times with teacher and classmates—but how many siblings to play with at home? Now "two" is the "perfect" number.
Chang outlines a possible scenario for the future: "What would happen when laborers in the tertiary sector lose their jobs during a recession? It's not easy for workers to return to the industrial sector, especially since the work is now very technical and requires trained laborers. Moreover, unemployed workers cannot easily return to the agriculture sector because they are rooted in the cities. Even if they were willing to work on farms, there would be no place left for them. And if cheap foreign labor were imported, it would both hamper industrial upgrading and aggravate local unemployment. "
Because a larger population will put added strains on the job market and educational facilities, Chang does not advocate a reversal in family planning policy. He would rather see technological and economic restructuring. "We are stuck in a dilemma because rapid population growth results in high population density," he says. "But when the population growth rate drops, the population unavoidably ages. We can't hold sway over such a contradictory position. We are compelled to choose one way or the other. "
Due to concerns about Taiwan's "aging population," the government has made a choice. The former government family-planning slogan—"One child is not too few; two are just right"—has now been changed. The National Health Administration has indicated that "two" is the "perfect" number.
Although this decision may at first appear ill-advised in light of the popular perception that the world is already overpopulated, the adjustment in policy has come in response to the island's rapidly declining fertility rate. The new policy is aimed at stimulating enough controlled growth to avoid some of the problems caused by "an aging population." While the complexity of the island's population growth will continue raising many social and economic challenges, in the final analysis the government has but a limited role in the key decision—it is parents themselves who must decide how many children they want to have and support.
Welcome To A Crowded World
The birth of Shen Yen-chen, a seven-and-three-quarter pound baby girl, was announced with great fanfare on the front page of virtually every newspaper in Taiwan. When Yen-chen took her first breath at 10:32 p.m. on July 12, the population of Taiwan reached 20 million. But banner headlines did not obscure related analyses in the media by local demographers and economists warning about the broader implications of the Shen family's happy event.
Dr. Chan Hou-sheng, a professor in the Department of Social Welfare at National Taiwan University, calls the public rejoicing over Yen-chen's birth a vestige of traditional altitudes: "The congratulatory ceremony held by government officials and the general public... is above all a manifestation of a residual value system, one which still governs much of our judgment today." While Chan agrees with the warm congratulatory feelings expressed by the media, he says that people should not overlook certain social problems intrinsic to Taiwan's changing population structure.
The area of Taiwan is only 36,000 square kilometers (13,885 square miles), and almost two-thirds of the island is mountainous and unsuitable for cultivation or dense habitation. With an overall population density of 556 persons per square kilometer—in fact, much denser along the western plains—the island ranks as the second most heavily inhabited region on earth. The dense population is creating serious challenges to the island's development.
In the past, when Taiwan was an agricultural economy, large families were a blessing because the primary mode of production demanded intensive labor. More hands on the farm brought more wealth, so large families were economically beneficial. China was supported by such an economy for millennia, but modern modes of production in Taiwan have now altered the rules of the game. What counts now is the quality of the work force rather than its quantity.
Taiwan is rapidly becoming a post-industrial society. In many ways, the island is already rich, with per capita GNP steadily rising and economic transformation well underway. But the prosperity could be threatened from an unexpected quarter-senior citizens. Lower birth rates combined with greater longevity mean that by the year 2000 senior citizens will comprise 8.4 percent of the population. These dependent elderly people will no longer be in the labor force, and the money spent to support their needs will divert capital from investment in development. While per capita income in Taiwan is expected to reach US$20,000 by the turn of the century, that achievement might become more remote as the aged population begins draining a greater portion of the island's resources.
Chan has hopes that Taiwan's economy will overcome the problems caused by an aging population with the absorption of a higher proportion of educated people into its productive sectors. He says that women will comprise a substantial part of that force: "In the future, brainpower and the female labor force will play major roles in development. Education is the key factor in helping Taiwan to catch up with the developed Western countries, and high quality labor created through formal training can shorten the time needed to develop a new labor class."
Government statistics indicate that this shift in the labor force is already in progress; 45.6 percent of working age females were officially classified as employed in 1988, a proportion considered high compared to most developing countries. The percentage of working women in the population is expected to continue rising in the near future. Equal educational opportunities for women, political liberalization, and a Westernized life-style have generated a mosaic of combined social forces that are helping improve the social position of local females.
With regard to social welfare for the elderly in Taiwan's "aging society," Chan insists that care of senior citizens should not be the sole responsibility of the government. "The government cannot create money by itself; it can only collect and redistribute the resources. All welfare and social security systems are based on the law of big numbers—a mathematical principle used to allocate the resources of the majority 'haves' to the minority 'have-nots.' Government acts best as a regulator, not as a main provider."
Greater population density also puts a strain on human interactions in a small space. Chan indicates that changes in social values are more potentially explosive than the economic challenges. He says there is stark contrast between Taiwan's material and social development: "Taiwan is a developed nation indoors, but when you step out on the street, it is a socially underdeveloped nation. This is an ethical and educational problem."
Chan adds that the traffic jams, public rudeness, pollution, and general irresponsibility among people are painful to witness, and even more striking when found just outside homes with high-tech appliances and plenty of food. He concludes that some of the time-honored Chinese traditions of concern for neighbors and family, combined with up-to-date Western ethics, might help reduce the stresses caused by a high population density.
Such problems are most likely far from the mind of Shen Yuan-cheng, the 26-year-old father of the celebrated baby girl. Shen came from a family of poor farmers in southern Taiwan, but today three generations and four families of the Shen clan live together in their own two-floor apartment—a major improvement in family fortune achieved after years of struggle. While the Shens are representative of thousands of families that have helped produce the so-called Taiwan miracle, they worked in an environment far different from contemporary society. As young Yen-chen matures, she will face a host of new problems brought about by the growth in population which her own birth eloquently emphasized.