China Initiates New Round of Minimum Wage Increases

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Including comprehensive China minimum wage update starting January 1, 2013

Jan. 4 – According to data recently released by China’s Ministry of Human Resources and Social Security, 23 regions in the country adjusted their minimum wage levels in 2012, including: Beijing, Sichuan, Jiangxi, Shaanxi, Shenzhen, Shangdong, Shanghai, Tianjin, Guangxi, Ningxia, Gansu, Shanxi, Yunnan, Chongqing, Jiangsu, Xinjiang, Fujian, Hainan, Qinghai, Hunan, Hebei, Inner Mongolia and Heilongjiang.

Furthermore, from January 1, 2013, Beijing and Shaanxi have raised their minimum wage payments for the second consecutive year. The monthly minimum wage in Beijing will be raised from RMB1,260 to RMB1,400, while in Shaanxi it will be increased from RMB1,000 to RMB1,150. Also effective from January 1, Zhejiang Province, which last adjusted its minimum wage levels in April 2011, will raise its monthly minimum wages by 12.2 percent, from RMB1,310 to RMB1,470.

The latest figures suggest that after the latest round of adjustments, Shenzhen will still hold the highest minimum wages in the country at RMB1,500, followed by Zhejiang at RMB1,470. Beijing will still have the nation’s highest hourly wage rate at RMB15.2, followed by Xinjiang and Shenzhen at RMB13.4 and RMB13.3, respectively.

According to government regulations, minimum wages across various regions are required to be raised at least once every two years. From 2008 to 2012, minimum wage levels across the country have registered an average 12.6 percent annual growth rate.

Minimum wage levels across the 24 municipalities and provinces can be found in the map and chart below.

Dezan Shira & Associates is a specialist foreign direct investment practice and can advise international companies investing in China on the country’s complete legal, tax and operational issues. The firm was established in 1992 and maintains 12 offices throughout China, in addition to practicing in Hong Kong, India, Vietnam and Singapore. For advice on all matters of China HR, payroll and costs, please contact the firm at china@dezshira.com or visit our web site at www.dezshira.com.

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