Guangdong Mulls over Improving Minimum Wage to Solve Labor Shortage

Authorities in this manufacturing hub of Guangdong province are planning minimum wage standard to attract more workers to the Pearl River Delta (PRD) and release a labor shortage, according to sources with the provincial government.

The new minimum wage in the region will be equal to or higher than special economic zone Shenzhen's adjusted minimum wage, which will be implemented on July 1, Chen Siyi, director of the wage division of the Guangdong labor and social security department, said on Friday.

In downtown Shenzhen, the minimum wage will be set at 1,000 yuan (145 U.S. dollars) a month. It will be raised to 900 yuan a month in suburban areas, reports Saturday's "China Daily".

A workshop of an electronics factory in Guangdong. (Michael Wolf)

The increases are 17.6 percent and 20 percent respectively from the previous year.

The current minimum wages in the whole of Guangdong are divided into five categories, ranging from 450 yuan to 780 yuan, according to the consumer price index of different cities.

The authorities are still studying the implementation date of the minimum wage and gathering feedback, Chen said, with detailed preparations being carried out by early next year.

It is an effective way to draw high-quality and skilled labor to the delta, he said.

Similarly, improving the minimum wage will help balance price inflation and guarantee a quality of life for workers, Chen said.

However, a number of business people are worried the higher minimum wage will exacerbate the current difficulties faced by labor-intensive manufacturing industries in the PRD.

"The new labor contract law has significantly increased our costs," Liu Hanmin, a manager of Dongguan Taisheng Furniture Company, said.

"If labor costs keep rising, we will move out of Guangdong province."

Source: Xinhua

Editor: Ronald Li