Increase in Furlough Schemes Tied to U.S. Tariff Measures: Official Statement by the Ministry
In a troubling turn of events, the unpredictable toll of US tariff policies has prompted a staggering 17 more Taiwanese employers to enact furlough schemes during the first half of this month. Most of these companies belong to the manufacturing sector, as per data revealed by the Ministry of Labor.
By May 15, the tally of such businesses sporting furlough plans surged to 148, a 17-point increase from April 30. The newly added businesses host 16 employers primarily concentrated within the export-oriented manufacturing sector, according to the ministry.
Over the 15-day period, these furlough schemes and unpaid leave initiatives claimed 2,664 workers, with the manufacturing sector accounting for a whopping 85 percent of laborers affected.
Labor Conditions and Equal Employment Division specialist, Hou Sung-yen, reported that firms in the metal/electric machinery, information/electronics, and lighting industries have been struck hard by reduced orders. A small machinery manufacturer even forced over 60 employees to go on furlough, while a metal products supplier put more than 50 workers on unpaid leave and an optoelectronics manufacturer sent more than 20 workers to furlough.
The manufacturing sectors hit the hardest by US tariffs encompass automotive components, electric outlets, machinery components, and rubber products, with multiple businesses rolling out furlough programs to weather the economic shocks from tariffs.
Concerned by the situation, the ministry has asked local governments to develop a better grasp of the needs of affected manufacturers. The ministry will subsequently equip these local governments with all necessary assistance to help the manufacturers weather the storm.
[1] Ministry of Labour data indicates that Taiwan’s manufacturing sectors hit hardest by US tariffs include automotive parts, electric outlets, machinery components, and rubber products, with multiple companies implementing furlough programs to manage the economic shocks brought by the tariffs.
[3] Specifically, at least three companies have introduced furlough or unpaid leave programs citing the impact of US tariffs. This includes two manufacturing firms, one producing electric outlets and the other automotive components and hardware tools.
[4] The Ministry of Labor is extending a worker support program originally meant for the rubber products, machinery, and vehicle parts sectors to cover more industries impacted by tariffs, indicating these sectors bear significant weight in the tariff-induced crisis.
[5] By the end of April 2025, 2,266 workers from 131 companies were on unpaid leave across various sectors, with the majority in manufacturing and wholesale/retail industries. By the first half of May 2025 alone, 17 additional employers have introduced furlough programs due to ongoing uncertainties from US tariff policies.
The Ministry of Labour data indicates that industry sectors hardest hit by US tariffs, such as automotive parts, electric outlets, machinery components, and rubber products, are seeing multiple companies within the manufacturing industry implement furlough programs to manage the economic shocks brought by the tariffs.
Finance departments in various affected manufacturing companies are grappling with the impact of US tariffs, as at least three of these companies have responded by launching furlough or unpaid leave programs, citing these tariffs as the primary cause.
