By Juan Fernando Herrera Ramos
Only 107,812 babies were born in Taiwan last year, barely half the number recorded in 2016. The nation is now a super-aged society, with more than one-fifth of its population aged 65 or older.
The National Development Council forecast that the population could fall from an estimated 23.2 million this year to just 12.1 million in 2075.
The decline in the working-age population would be even more severe. The number of people aged 15 to 64 is projected to plunge from an estimated 15.8 million this year to 5.1 million by 2075, a reduction of about 67 percent. By then, people aged 65 or older could constitute 52.9 percent of the population.
Taiwan is beginning to recognize something that many governments still hesitate to say openly: Family subsidies alone cannot repair a labor shortage that has already been determined by births that did not happen 20 or 30 years ago.
Its answer is an increasingly deliberate, although still incomplete, attempt to attract and retain foreigners.
Amendments to the Act for the Recruitment and Employment of Foreign Professionals (外國專業人才延攬及僱用法) took effect this year. They extended digital nomad visas to as long as two years, made it easier for foreign graduates of local universities to remain and work in Taiwan, expanded access to employment insurance and labor pensions, and shortened permanent-residence pathways for some highly skilled professionals.
The message is significant. Taiwan is no longer looking only for temporary employees. It is cautiously competing for taxpayers, engineers, entrepreneurs and graduates who might build their lives in the nation.
Taiwan already has more than 800,000 foreign workers, representing about 7 percent of its workforce, roughly twice that of Japan. Workers from Indonesia, Vietnam, the Philippines and Thailand have become indispensable to local factories, construction sites, hospitals and long-term care system. However, Taiwan’s policy remains divided between welcoming internationally mobile professionals and controlling the lower-paid migrant workers on whom much of its economy depends.
Under the National Immigration Agency’s Alien Permanent Resident Certificate (APRC) criteria, applicants using the salary route must demonstrate average monthly income exceeding twice Taiwan’s minimum wage, which is something out of reach for blue-collar employees.
Taiwan nevertheless appears to be moving toward the idea that selected foreigners should be encouraged not only to work, but also to settle.
Japan is moving in a more cautious direction.
Its demographic arithmetic is equally unforgiving. Japan recorded 671,236 births last year, a fall of 2.2 percent from the previous year. Its total fertility rate declined to 1.14, while deaths exceeded births by 918,253.
Japan’s population is projected to decrease from 126.1 million in 2020 to about 87 million in 2070. Its working-age population could shrink from about 74.2 million in 2022 to 45.4 million over the same period.
Japan is not, as is sometimes claimed, closing its borders. It had a record 2.57 million foreign workers in October last year, an increase of 11.7 percent in a single year. The number of foreign residents exceeded 4.1 million by the end of last year.
Companies need the workers, and the government has continued expanding employment programs to obtain them. The country would struggle to operate its factories, hotels, restaurants, farms, construction projects and care facilities without foreign workers. Yet Japan is drawing a sharper distinction between allowing foreigners to work and allowing them to stay permanently.
Under revised permanent-residence guidelines, Japan is introducing tougher expectations covering household income, pension and tax compliance, language ability and family integration. In principle, applicants might be expected to demonstrate Japanese proficiency equivalent to the B1 (intermediate) level, although exemptions apply to certain highly skilled professionals and other categories. The permanent-residence application fee also rose from ￥10,000 to ￥200,000 (US$64 to US$1,273), while other residence-renewal and status-change fees increased sharply.
None of these measures ends immigration. However, taken together they suggest a country that wants foreign workers while remaining reluctant to convert that labor into permanent membership of Japanese society.
That is the emerging difference between the two East Asian economies.
Taiwan is trying to turn at least part of its foreign workforce into long-term residents. Japan is admitting foreign workers in record numbers while placing higher barriers around permanent settlement. Taiwan’s system says, imperfectly, that more foreigners should be persuaded to remain. Japan’s increasingly says that foreigners might be needed, but continued residence must be more selectively earned.
Both approaches contain political and economic risks.
Taiwan’s liberalization remains focused heavily on professionals and investors. If migrant caregivers and factory workers remain locked into a separate, temporary system with limited mobility and settlement opportunities, Taiwan would have created a hierarchy of desirable and disposable foreigners.
Japan faces the opposite danger. A country can raise entry numbers without becoming more attractive as a permanent destination. Foreign workers compare salaries, currencies, living costs, workplace treatment and the possibility of bringing their families. They are not simply a reserve labor force waiting for Japan to select them.
Higher barriers might be politically popular, but they could make recruitment more difficult as Japan competes with Taiwan, South Korea, Singapore, Europe and the Gulf states for a shrinking pool of internationally mobile workers.
Neither country can solve its demographic crisis through immigration alone. Automation, later retirement, higher female employment and support for families will all remain necessary. However, migration is one of the few policies capable of affecting labor supply in the near term.
The real choice is therefore not between immigration and no immigration. Taiwan and Japan are already immigration economies, whether their political systems acknowledge it or not. The choice is whether foreign workers are treated primarily as temporary inputs or as potential long-term members of society.
Taiwan has started, cautiously and inconsistently, to place a greater bet on the second model. Japan is expanding the first while making the second more demanding.
As their populations age and their workforces contract, the results of those opposing bets will matter far beyond immigration policy. They will help determine which economy can keep its factories operating, care for its older people and remain competitive in an Asia where workers, not jobs, are becoming a scarce resource.
Taiwan has time to turn demographic necessity into a competitive advantage over its neighboring countries. It can offer foreign workers what many aging societies hesitate to provide: a realistic opportunity to become permanent residents, raise families and participate in national life.
Doing so would require fairer residency standards, stronger labor protections and pathways that extend beyond highly paid professionals. Immigration will not reverse Taiwan’s low birthrate or replace broader economic reform, but it can slow the contraction and give society more time to adapt.
The countries that attract workers will survive demographically. Those that persuade them to stay will be the ones that prosper.
Juan Fernando Herrera Ramos is a Honduran journalist based in Taipei. His work on Taiwan-China-Latin America relations has been published in Nikkei Asia, The Diplomat and the Taipei Times.