While Taiwan’s job market has been robust over the last two years due to the global tech talent shortage, in 2023 the market will be facing uncertainties amidst waning export demand, looming recession and geopolitical tension and will still remain short of candidates, according to a report by the European Chamber of Commerce Taiwan and Robert Walters.

Companies are expected to face challenges in hiring quality candidates and building a sustainable workforce post-pandemic, the report found.

Despite the Taiwan government implementing various policies to support domestic industries and attract foreign investment, 2023 is set to be a challenging time for recruiting the right talent due to uncertainties. A candidate short market will persist as 57% of professionals are looking to change jobs in 2023 with 90% of them putting more emphasis on job stability. Average salary increments will vary across industries and skills and are anticipated to be around 10-15%. However, with the widespread global skill shortages, companies may scramble to fill some vacancies requiring new tech and niche skill sets, with those professionals expected to command over 25% pay rises.

The Taiwan tech sector may enter a cyclical downturn with a softened hiring market in 2023 due to cooling demand, oversupply, and exceptionally strong growth over the last few years. However, with Taiwan being the leader in semiconductors and foreign tech companies still keen to invest in Taiwan, there will be a strong demand for skilled talent in the long run. This includes areas such as electrical vehicle applications, cloud/enterprise server and 5G base station.

Top skills in demand will include software development, cyber security, DevOps/SRE for the Software & IT sector, and analog design, digital design as well as design verification for the semiconductor sector.

The report also found that 78% of software, semiconductor & IT professionals and 65% of electrical products & industrial professionals are expecting a pay rise in 2023. Despite a return of some overseas professionals, the competition for top talent will remain fierce with 50% of surveyed Taiwan tech talent looking to change jobs in the next 12 months due to the concern in job stability.

Meanwhile, 85% of employers are concerned about a skill shortage in their field of hiring.

Instead of competing over a small pool of talent with similar credentials, companies are advised to look beyond the résumé and shift towards a skills-based hiring strategy, identifying and selecting candidates based on their specific skills and qualifications, rather than solely on their experience or education.

Apart from the talent shortage, 60% of employers reported the challenge of unmatched salary expectations during the interview process and 59% of them experienced high competition for candidates from competitors’ counteroffers and buy-backs. 

The disconnect between the expectations of employers and candidates was mainly driven by the proliferation in salaries and employee benefits to compete for talent during the pandemic in Taiwan, and underscores the growing importance of non-financial benefits to attract and retain staff.

Another challenge faced by employers in Taiwan is navigating the transition back to pre-pandemic circumstances, and to ensure productivity, engagement, and well-being are upheld at the same time. 

Employers are advised to adapt to the accelerated shift towards a more flexible and employee-centric workplace culture and have strategies in place to mitigate the potential descriptions with the transition back to the office, as employees are now expecting their employer to be more responsive to their wellbeing and more adaptable to change.

John Winter, General Manager at Robert Walters Taiwan, said, “The Taiwan job market is one of the most dynamic in the region and we're confident that it will continue to be a destination of choice for job seeking and investment. The challenges of acute talent shortage and shifting from pandemic-driven workplace to a newer norm will remain in 2023, accompanied by economic uncertainties and rising costs. It is important for companies to place more value on EVPs (employee value proposition), bolster company culture and make hiring strategy more inclusive to secure and retain the in-demand talent through 2023.

“Employers are encouraged to consider candidates who may not have direct experience in the specific role but have transferable skills; continue to upskill them and invest in their development to keep them motivated. This not only helps secure talent in the short run, but also builds a strong pipeline for company growth,” Winter said.