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Business / Economy

China to achieve minimum wage growth target

(Xinhua) Updated: 2015-05-29 10:16

BEIJING - China is expected to achieve its average annual minimum wage growth target of 13 percent for the five-year period ending in 2015, experts said on Thursday.

Nineteen regions in Chinese mainland increased their minimum wage at an average rate of 14.1 percent in 2014, the Ministry of Human Resources and Social Security said on Thursday.

The growth pace is faster than the planned annual average growth rate, but slower than the previous three years, said the ministry in a statement posted on its official website.

In China, where city and provincial governments set minimum wage standards, 27 regions raised the minimum wage by an average rate of 17 percent in 2013, while minimum wage hikes in 25 regions surpassed 20 percent on average in 2011 and 2012.

Last year, Shanghai registered both the highest statutory minimum monthly wage of 1,820 yuan (about $297) and the highest hourly rate of 17 yuan, the statement said.

"Although the annual minimum wage growth slowed, the rate is considered high given that inflation-adjusted growth still outpaced GDP expansion," said Zhou Tianyong, professor with the Party School of the Central Committee of the CPC.

China's economy grew 7.4 percent in 2014, the weakest annual expansion in 24 years, while the consumer price index (CPI), the main gauge of inflation, rose 2 percent year on year.

It is quite normal that the minimum wage growth rate downgraded after the economic slowdown and commodity price falls, said Su Hainan, deputy head of the China Association for Labor Studies.

"The above-20-percent growth pace could not last forever," Su added.

Zheng Bingwen, chief of the World Social Security Studies Center at CASS, believes the increase in minimum wage will generate immediate benefits for the lowest-paid workers.

Data provided by the National Bureau of Statistics also showed that the pay of Chinese urban workers grew at a slower pace last year.

The average annual income of urban employees in the public sector rose by 9.4 percent year on year to 56,339 yuan, a growth rate 0.7 percentage points lower than in 2013.

Income of private sector employees surged by 11.3 percent to an annual average of 36,390 yuan, with the growth rate 2.5 percentage points lower when compared with 2013.

Income growth in recent years can be considered "compensatory," given that Chinese workers' salary growth has been less than the rate of GDP growth for many years, said Zheng Gongcheng, head of the Social Security Research Center affiliated with the Renmin University of China.

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