From Industrialization to Struggle: Labour, Crisis, and Collective Memory in Taiwan

Contributed by Shu-Wei Yang (Secretary-General of the Taiwan Labour Front)

Taiwan’s path to economic development, like that of many developing countries, was built through rapid industrialization. From the 1950s onward, the state actively supported private enterprises through subsidies and protectionist policies. In 1965, the government passed the Export Processing Zone Act, and in the following year established the world’s first export processing zone in Kaohsiung. By opening to foreign investment and integrating local firms into global production networks, Taiwan developed into an export-oriented economy and became a key manufacturing base within the U.S. and Japanese-led international division of labour. What has often been called Taiwan’s “economic miracle” was, in essence, a period of industrial expansion driven by mass production and export growth.

However, this rapid development was deeply shaped by an authoritarian political system. Like South Korea and Singapore, Taiwan’s economic growth was achieved under a form of “developmental authoritarianism.” While capital accumulation and national economic goals were prioritized, civil society was tightly controlled. Workers, despite their growing numbers, remained marginalized, lacking basic legal protections. Core labour rights—including the right to organize, to bargain collectively, and to strike—were systematically suppressed under martial law.

During this period, trade unions were either heavily regulated or directly controlled by the state and employers. Independent labour organizing was nearly impossible. As a result, workers had little room to assert their rights, and labour struggles were largely absent from the public sphere—not because exploitation did not exist, but because resistance was structurally repressed.

This situation began to shift in the late 1980s and 1990s, as Taiwan underwent democratization and faced new economic pressures. With the rise of China and Southeast Asia, Taiwan’s comparative advantages eroded. Increasing labour and land costs pushed many business owners to relocate production overseas. Entire industries—including textiles, garments, footwear, and low-end electronics—rapidly moved out of Taiwan, leaving behind widespread factory closures and mass layoffs.

We witnessed how Taiwan’s industrial landscape changed almost overnight. Workers who had spent decades contributing to the country’s economic growth suddenly found themselves unemployed, often without severance pay, pensions, or even their final wages. “Malicious factory closures” became a recurring phenomenon—employers would shut down operations without notice, remove equipment, and disappear, leaving workers with no explanation and no compensation.

For many workers, the institutional channels that were supposed to provide protection proved ineffective. They filed complaints with local labour bureaus, sought mediation, and appealed to elected representatives. Yet these processes rarely led to concrete outcomes. Administrative systems were limited to handling disputes procedurally, without the capacity or willingness to enforce accountability. In many cases, workers were left waiting indefinitely, with no resolution.

It was often at this point that workers came to us.

At the Taiwan Labor Front, we frequently encountered workers who had already exhausted all formal avenues. They came not at the beginning of a dispute, but after experiencing repeated failure within the system. In such moments of frustration and desperation, collective action became the only remaining option. Together with other labour organizations, we supported them in developing strategies for protest—transforming isolated grievances into collective struggles.

These protests were not radical in their demands. Workers were asking for rights already guaranteed under existing labour laws. Their actions were aimed at forcing a passive state to fulfill its responsibility: to enforce the law and hold employers accountable. In practice, however, one of the few effective mechanisms at the time was to pressure the central government to designate a case as a “major labour dispute.” Only then could employers face restrictions, such as travel bans, that would compel them to come forward and negotiate.

Through these struggles, we came to see a deeper contradiction. Employers often understood that they had violated labour laws, yet also knew that there would be little consequence for doing so. From their perspective, abandoning workers was simply a rational economic decision. For many workers, what they sought was not only unpaid wages or pensions, but a basic sense of dignity—sometimes as simple as an apology. Yet even this was often denied.

In many cases, workers redirected their protests toward the government. If the law existed but was not enforced, then the problem was not only individual employers, but the state itself. However, instead of acting as a guarantor of rights, state institutions frequently treated protesting workers as potential threats to public order. Labour actions were met with police intervention, forced evictions, and, in some cases, criminal prosecution.

One of the most emblematic cases we were involved in was the 1996 struggle of workers from the Fuchang Textile Company. After the factory closed, the employer failed to provide adequate compensation and defaulted on wage payments. Workers staged protests, including a prolonged encampment outside the Council of Labor Affairs, only to be forcibly removed by the police. In a later escalation, workers surrounded company executives for 60 hours to demand negotiations, resulting in criminal charges against union leaders.

That same year, in another major case involving the Lien Fu Garment Factory, more than 300 laid-off workers reached a point of complete desperation. After all negotiations failed, and after government promises proved impossible to fulfill, they made the decision to lie down on railway tracks in protest. We supported this action as a form of nonviolent resistance, emphasizing that it was an act of last resort—workers committing a minor legal offense to expose the state’s inability to address far more serious economic injustices.

The image of hundreds of workers occupying the railway, holding banners reading “The normal channels are blocked,” captured a harsh truth: when institutional pathways fail, protest becomes the only language left.

Following the protest, dozens of workers were prosecuted. One of the leaders was sentenced to prison. Yet even as repression continued, these struggles began to reshape public consciousness and political priorities.

Throughout the 1990s, we also worked to translate these experiences into policy demands. Through internal study groups, engagement with scholars, and exchanges with international labour movements, we developed proposals for institutional reform. We drew on concepts such as industrial democracy in Europe, while also responding to Taiwan’s specific conditions.

For example, our call for a standalone unemployment insurance system was not a technical preference, but a lesson learned from repeated crises. Without an independent legal and financial framework, unemployment protection could easily be weakened or suspended. What workers needed was not temporary relief, but a stable system capable of “catching” people in times of crisis.

After years of advocacy, protest, and negotiation, the early 2000s marked a turning point. With rising unemployment following the dot-com bubble and a change in political leadership, labour issues gained renewed attention. A series of key reforms—including the The Mass Redundancy Protection Act was enacted in 2002, followed by the implementation of the Employment Insurance Act in 2003. Together, these laws marked the moment when the most critical pieces of Taiwan’s employment security system were finally put into place.

These changes were not simply the result of policy design. They were the outcome of years of struggle—of workers who refused to remain silent, and of collective efforts to transform suffering into institutional change.