Wages stagnated despite labor shortage: report

09:56, May 25, 2010      

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Wages have not risen in China despite a shortage of workers, a report in Outlook magazine said.

The magazine said manpower costs only represents between 10 and 15 percent of some enterprises' total expenses, according to Ren Zhaocheng, the head of a workers union in Jiangsu Province.

The report said the minimum wage in some cities was not adjusted as often as the law requires.

For example, there was no minimum wage adjustment in Guangzhou, Guangdong Province, between January 1999 and January 2003, even though regulation stipulates that an adjustment should be made once every two years. An adjustment made in December 2004 only lead to an increase of just 59 yuan after deductions.

The report said the minimum wages in 31 cities are still lower than the national standard.

Even if enterprises increased wages, workers would not see a big difference since they need to contribute to their pension and various kinds of insurance.

Su Hainan, head of the wages studies institute under the Ministry of Human Resources and Social Security, told the magazine that workers get about 40 percent of their wages after contributions.

Lü Qian, a Japanese teacher in Beijing, earns about 4,000 yuan ($585) a month. But she was not left with much money after tax, pension and insurance deductions.

"I always feel that my hard working efforts are in vain," she was quoted as saying.

The report said that changing jobs would not help workers much because remuneration packages offered by different companies are similar.

It attributed the reason behind low wages to unhealthy development of some industries. Some local governments are responsible for the problem. For example, the pay offered by some governments to clean streets is too low so bidders can only offer so much.

The magazine, citing academics and experts, said enterprises should negotiate wages with employees, and the negotiation should be protected legally.

Yang Yiyong, the director of the Institute of Social Development under the National Development and Reform Commission, said authorities should lay out concrete objectives for achieving equality in income distribution, and specify the objectives in the national five-year development plan.

Su said some labor-intensive industries should be given tax concessions, which allows enterprises to lower their financial burden and possibly encourage them to increase wages.

Source: Globaltimes.cn - Agencies


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