Output per Employee: A Shared Challenge for Taiwan’s Services and Startups

Taiwan’s service sector and startups face a similar problem: output per employee is too low. Manufacturing and technology companies serve global markets and therefore achieve high output per employee. As I recall, Giant, the bicycle company, generates considerable output per employee. By contrast, output in services is too low. Taiwan must think seriously about raising it. The sector employs many people, but low output means it cannot attract truly outstanding talent. In Taiwan, the best people therefore tend to choose technology. Those unable to enter the technology sector may turn to manufacturing or financial services, but much of the broader service sector must fundamentally reconsider how technology and digital tools can increase each employee’s output. The same applies to Taiwanese startups. Low output per employee prevents them from paying competitive salaries and attracting strong talent. The best people first move toward global technology giants such as Microsoft, Google, Meta, and Nvidia; next come leading domestic companies such as TSMC and MediaTek, followed by larger Taiwanese technology and electronics companies. ---- Monitoring output per employee is not a crude metric. Financial analysts track changes in it at global technology giants including Apple, Google, Microsoft, Meta, Netflix, and Amazon. If even those companies emphasize the measure, small Taiwanese startups cannot ignore it. It is central to whether they can attract truly strong people.