Taiwanese jobless at record high

Taiwan's WTO entry is expected to cost more jobs

Taiwan's unemployment rate hit a record high of 5.26% in September as factories closed and companies downsized amid the global economic slowdown.

The rise put Taiwan on track for a record 4.5% unemployment in 2001, up from last year's 2.99% record, the statistics agency said.

The twelfth straight monthly rise was blamed partly on the attacks on the US.

"The 11 September attacks and US retaliation will more or less have an impact on the global economy, making it hard to predict when Taiwan's economy will recover," said Chen Jin-cherng, a deputy director at the Directorate General of Budget, Accounting & Statistics.

Unemployment to rise

Traditionally, the jobless rate is lower in September than in August because students go back to school and create job openings.

Mr Chen said that the jobless rate will average 5% in the fourth quarter and is unlikely to fall below 3% before Taiwan enters the World Trade Organisation (WTO) early next year.

WTO membership is expected to push unemployment up as Taiwanese companies move to the mainland to take advantage of cheaper labour.

The government has forecast that the economy will contract by 0.37% in 2001 but is expected to cut that forecast when it meets for its quarterly economic review next month.

It is the island's worst economic performance since it began keeping records in 1962 and is its first ever full-year contraction.