Taiwan's economy is experiencing a boom, with GDP growth projected to reach 10.16% in 2026, a significant increase from the previous projection of 3.71%. This growth is largely attributed to the semiconductor industry, which has seen rapid expansion and generous pay raises. However, the benefits of this growth are not felt by the majority of Taiwanese citizens, leading to a K-shaped economic structure where certain sectors and wages stagnate or decline.
The average income in Taiwan has increased, but this is largely due to the high pay in the semiconductor sector, which employs around 300,000 people. The majority of Taiwanese workers are still earning below the average, and the wage gap between industries is substantial. The company that single-handedly pulled up the average was TSMC, which approved a record NT$206.14 billion in employee performance bonuses and profit-sharing compensation in 2025.
The wealth gap in Taiwan is even more stark than the income gap. The wealthiest 20% of households have an average net worth of NT$51.33 million, while the poorest 20% have an average net worth of just NT$770,000. The wealth of the two groups differed by a factor of 66.9, compared with 16.8 in 1991. Housing has played a key role in widening the wealth gap, with the price of a median home being 9.32 times the median household's annual disposable income in 2025.
The non-semiconductor industries in Taiwan are facing a bleak future, as the country's industrial landscape is overly concentrated in a handful of sectors. The government is trying to encourage machinery companies to produce semiconductor manufacturing equipment, but the gaps in growth and wages between traditional industries and the high-tech sector remain wide. This polarization across industries and society is a warning to Korea, which is experiencing the same semiconductor upcycle.
In conclusion, Taiwan's economy is experiencing a boom, but the benefits are not felt by the majority of citizens. The wealth gap is widening, and the non-semiconductor industries are facing a bleak future. The government needs to take steps to address these issues and ensure that the benefits of the economic growth are shared more equitably.
