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Shockwaves and worry in Taiwan

Welcome to Hsinchu Science Park. Now leave.

HSINCHU SCIENCE PARK, Taiwan — As dusk falls in this soulless technology park an hour southwest of Taipei, a young woman waits for her husband to pick her up with his scooter. And she worries.

The 30-year-old is a technician for Taiwan Semiconductor Manufacturing Company. By the island's standards, she is lucky — TSMC is one the top technology firms here.

But since December she's been forced to take five days per month of unpaid leave, slashing her salary by a quarter. She has two kids at home, and worries things could get worse. "I'm afraid I could get laid off."

Here in Taiwan's own Silicon Valley, technology workers wait anxiously, and wonder when Americans halfway around the globe will go back to their gadget-buying ways.

After decades of economic growth — and stunning business success as Taiwan became a central player in the global technology industry — the shockwaves from the U.S. economic crisis are being felt even in this distant park, at the center of Taiwain's once-booming economy.

Until Americans do start buying again, the catchphrase here at Hsinchu is "wuxinjia" — unpaid vacation. Since late last year, bosses have ordered workers here to take anywhere from three to eight days off per month.

The strategy is a way to stay lean in tough times, without resorting to layoffs. But in an age of globalized supply chains and interconnected economies, wuxinjia is also a painful reminder of how problems in the U.S. can whiplash out, touching lives far beyond American shores.

Taiwan's banks were mostly spared a financial crisis because they had little exposure to bad U.S. debt.

Instead, it's the drop in consumer spending in the U.S., Japan and European markets that has hammered Asia's export economies. Exports plunged 29 percent in Taiwan last month, 25 percent in China, 24 percent in Singapore and 18 percent in South Korea.

Cargo ships lay idle in Philippine ports, and in Malaysia, the electronics maker Flextronics recently announced it will lay off some 1,400 workers.

For Taiwan, this technology park is the epicenter of the downturn. Here, firms that Americans have never heard of churn out many of the computer chips, flat-panels and technology components for the gadgets on U.S. retail shelves.

The park sprawls out over a huge plot of land. Even with fewer workers showing up every morning, thousands of middle- and upper-class workers still jam the entrances on scooters and cars.

http://www.globalpost.com/dispatch/china-and-its-neighbors/090317/shockwaves-and-worry-taiwan