Nov. 19 – China’s Ministry of Human Resources and Social Security has instructed local governments to maintain the minimum wage levels to aid companies in dealing with the global credit crisis.
“In the light of the current economic situation and real conditions in companies, minimum wage increases have been suspended for the near term,” said the ministry in a statement.
It went on to say that local governments should consider decreasing medical and accident insurance premiums to ease burdens on businesses and employees.
The U.S. export slowdown has hit China’s labor-intensive manufacturing industries hard and led to factory closures and layoffs. The waning export orders has also been aggravated by rising labor costs, materials costs and the appreciation of the Chinese currency.For the first nine months of the year, nineteen Chinese provinces and cities increased the minimum wage by an average of 15 percent.
China has already begun implementing the RMB4 trillion economic stimulus plan since last week to buffer the economy from the effects of the financial crisis by encouraging more infrastructure development to create jobs.