This society actually pays less to foreigners than it does to locals for the provision of equivalent services. The numbers paid in salary are just part of the equation.
First, Taiwan has to foot the bill for educating the local worker. For the white-collar worker, that means almost 20 years of education, which adds up to a substantial cost for society. It’s an investment made in order to yield the 30 to 40 years of productivity that can be extracted from the average male worker (and substantially less for females). The foreign worker brings the benefits of an education which hasn’t cost Taiwan a penny.
Then there are post-retirement costs. The average life-expectancy after retirement these days must be at least 20 years. The local white-collar retiree will either receive a substantial monthly pension for life (which in the case of government employees and many others is highly generous) or a large lump-sum payment equivalent to many years of full salary. Foreign employees seldom qualify for such benefits.
There are also many other perks, allowances, payments and so on that local employees receive but foreigners do not. For example, colleagues in the central government with qualifications and duties on a par with mine have a very good chance of being sent to the U.S. or U.K. to study for a master’s or Ph.D. or on other such courses at the government’s expense. They not only receive their full salary while they are away, but they also receive an extra (and generous) living allowance (though I’ve never quite worked out why they should need this when their salary is already far higher than the income of most Western students) and have all of their tuition fees paid for them. There are many, many other fringe benefits that push up the overall value and amount of their compensation, including the notorious 18% preferential interest rate on their savings in the bank. Foreigners are not entitled to any of these things, by virtue of our being foreign.
And of course there are the Chinese New Year bonuses. I’ve never received one and I don’t know of many other foreigners who have. Locals receive at least a couple of months’ pay as bonus, and many would consider themselves very hard done by to receive just that much. Often they get many times more.
Even without factoring in the grey and hidden sources of income that many many locals enjoy but we do not, or the gradually increasing welfare benefits from which we are excluded, the overall value of the rewards they receive is likely to be much higher than ours.
So if we have a local and a foreigner working side by side, don’t be fooled into thinking that the foreigner is so fortunate because his salary is 100k compared to 60k for his Taiwanese colleague. In reality, the whole of what the local guy receives will be worth much more than is handed out to the foreigner.
And one more thing. I, for one, took a huge cut in income by coming to work in Taiwan. As I’m not here for the money, I’m willing to accept that. And there are many other foreigners here in a similar situation. Taiwan is getting our services – our contribution to their society – at much below the global market price. So I’d better not hear any mutterings about my nominal salary being a few cents higher than that paid to locals.
Wage gap? Yes, but it’s not as you might think.