In a strategic move to cushion the blow from looming U.S. tariffs, Taiwan’s Ministry of Labor (MOL) announced an expansion of its existing worker relief program to include employees furloughed due to trade disruptions. The decision was confirmed by Labor Minister Hung Sun-han (洪申翰) during a press briefing at the Legislative Yuan on Wednesday.
Initially launched on March 24, the original subsidy program targeted workers from three traditional manufacturing sectors—rubber, machinery, and automotive parts—who had been furloughed for at least 30 days. With the new amendment, the program will also support sectors affected by the recent trade policy shifts under U.S. President Donald Trump.
Background: U.S. Tariffs and Economic Ripples
On April 2, 2025, President Trump announced sweeping 10% blanket import tariffs intended to rebalance U.S. trade deficits. Although paused for 90 days to allow for negotiations, the uncertainty surrounding final tariff rates has already sent shockwaves through global supply chains—especially in export-reliant economies like Taiwan.
Taiwan, while not directly targeted like China, faces significant secondary impacts, particularly in sectors such as high-tech manufacturing, semiconductors, and machinery—all of which are heavily embedded in U.S.-bound supply chains.
To mitigate economic disruptions, Premier Cho Jung-tai’s administration unveiled a NT$93 billion (US$2.89 billion) stimulus package on April 4, of which NT$15 billion (US$466.51 million) has been earmarked for employment stabilization initiatives. It is from this fund that the expanded MOL program will be financed.
Expanded Program Details
The MOL, in coordination with the Ministry of Economic Affairs, is currently identifying which sectors should qualify for relief under the expanded scope. This will be based on each sector’s exposure to U.S. tariffs, historical trade data, and potential job losses.
Key additions to the eligibility criteria include:
- Company Registration: Applicants must be employed by a firm registered with Taiwan’s International Trade Administration.
- U.S. Trade Record: Companies must provide documentation proving U.S.-bound exports within the past three years.
- Tariff Impact Proof: Evidence must be shown that these exports have been negatively affected by the new U.S. trade policies.
Eligible workers may receive monthly subsidies of up to NT$8,700 (approx. US$270), aimed at helping them sustain basic living needs during temporary furloughs or employment gaps.
Economic Implications and Policy Significance
This measure reflects the Tsai-Chen administration’s broader strategy of “buffering external shocks through internal safeguards.” The expansion comes amid growing calls for Taiwan to diversify its export destinations and reduce dependency on the U.S. market.
Expert Commentary:
Dr. Hsiao Mei-ling, a labor economist at National Taiwan University, said the expansion represents a pragmatic policy pivot.
“It shows Taiwan’s awareness of global trade risks and readiness to act swiftly to prevent unemployment spikes. But more structural reforms—such as upskilling and domestic consumption support—are needed for long-term resilience.”
While the subsidies will offer short-term relief, some economists warn that if U.S. tariffs become long-standing, deeper transformations in Taiwan’s industrial policy, labor structure, and trade agreements may be necessary.
FAQs
Who is eligible under the new expanded worker relief program?
Workers furloughed for 30 days or more whose employers have U.S.-bound exports and meet three key criteria related to trade registration and proof of tariff impact.
How much financial aid is provided under the program?
Eligible workers can apply for a monthly subsidy of up to NT$8,700.
Why is this expansion happening now?
It is a preemptive step to cushion Taiwan’s labor market from the potential fallout of U.S. tariffs that are currently paused but could be reinstated.
Which sectors are likely to be included next?
High-tech components, semiconductors, electronics, and chemical manufacturing are among the sectors being considered.
How is this program funded?
Through the NT$15 billion allocation from the NT$93 billion relief package unveiled by the Executive Yuan in early April.
