Minimum wages across China
Determining the minimum wage in China is complicated. First, wages are set for individual cities, provinces and other administrative units by their respective local governments rather than on a nationwide basis. Next, each of these principalities is divided into a number of wage classes, whose minimum wages vary according to local socio-economic conditions. Lastly, the minimum wage is differentiated between the minimum monthly salary and the minimum hourly wage (for full-time and part-time workers, respectively). According to China’s Employment Promotion Plan, the minimum wage in each jurisdiction must be increased at least once every two years.
Average wages are much higher compared to government stipulated minimum wages and continue to increase every year. The 2019 average wages are shown below:
Average annual salaries by region (urban units)
Assumed exchange rate: 1 USD = 6.84 Yuan
Average salaries in major sectors (urban units)
|Agriculture, Forestry, Animal Husbandry, and Fishery||39,340||5,751|
|Production/Supply of Electricity, Gas, Heat, and Water||107,733||15,750|
|Transport, Storage, and Post||97,050||14,189|
|Information Transmission, Software, and IT||161,352||23,589|
|Wholesale and Retail Trade||89,047||13,019|
|Hotels and Catering Services||50,346||7,361|
|Leasing and Business Services||88,190||12,893|
|Scientific Research and Technical Services||133,459||19,512|
|Management of Water Conservancy, Environment, and Public Facilities||61,158||8,941|
|Services to Households Repair and Other Services||60,232||8,806|
|Health and Social Service||108,903||15,921|
|Culture, Sports, and Entertainment||107,708||15,747|
|Public Management, Social Security, and Social Organization||94,369||13,797|
Assumed exchange rate: 1 USD = 6.84 Yuan
In China, overtime is paid depending on the work hour system adopted by the employer:
- standard work hours
- comprehensive work hours
- non-fixed work hours
Comprehensive and non-fixed work hour systems require special approval to implement. Under the standard work hours system, employees work eight hours or less a day and 40 hours or less a week. They have the right to at least one rest day per week.
The majority of white-collar jobs in China now operate according to this model. Rather than a unit of one week, the comprehensive work hour system adopts a set period (typically one month) as the base to calculate the employee’s working hours. Although the distribution of hours worked during this period can be irregular, the average number of working hours per day and per week should roughly correspond to the levels set out in the standard work hour system. Lastly, the non-fixed work hour system is geared toward positions that generally do not receive overtime payments such as:
- senior management
- employees in the transport, warehousing and railway sectors
Social insurance payments in China (also called “social welfare” or “mandatory benefits”) are mandatory contributions to government-run funds made by both the employer and the employee (whose contribution the employer is responsible for withholding each month). Social insurance obligations from the employee and employer, respectively, can vary considerably depending on the city in which the contributions are being made. For a company with employees based in many cities around the country, the overall cost to the company for an employee earning a monthly salary of RMB 10,000 in one city may be quite different for someone on the same salary based elsewhere.
In total, there are five social security funds:
- Occupational injury
Added to these is a mandatory housing fund not strictly considered a type of social welfare, but generally included within the scope of social security. Housing fund contributions are mandatory and come from both the employer and the employee, apart from some special areas where the employee does not need to make a contribution. Money in the housing fund can be used by employees to pay the down payment on a house or to subsequently pay back a loan to the bank.
While employees are also mandated to make their own contributions to several types of social insurance, the portion contributed by the employer is normally higher. In fact, social security payments typically add an additional cost of between 30% and 45% of an employee’s salary each month.
Mandatory benefit types
Mandatory contribution rates are stipulated by local governments, and the exact calculations involved can be quite complicated. Percentages are not technically based on the employee’s monthly salary, but rather on a theoretical “base” salary stipulated differently from city to city. Foreign invested enterprises should follow the local rates when calculating payroll and paying mandatory contributions for the social security of their employees.
|Employer rates||Employee rates|
|1 The contribution amount in each category is calculated by using the employee’s payment base figure and multiplying it by different percentages required by each local government entity.|
|Pension||Around 10% to 22%||Around 8%||An individual can receive a pension based on the amount accumulated in his/her individual fund after retirement.|
|Medical||Around 5% to 12%||Around 2%||In the event of illness/non-occupational injury, an employee can have part of the treatment cost covered by medical insurance.|
|Unemployment||Around 2%||Around 1%||In the event of redundancy, the employee may claim unemployment benefits for a maximum of 24 months.|
|Maternity||Around 0.5% to 1%||-||During maternity leaves, the employer receives reimbursement from this insurance fund.|
|Work-related injury||Around 0.5% to 2%||-||The work-related injury fund covers the cost of treatment should an occupational injury or illness occur.|
|Housing fund||Around 5% to 12%||Around 5% to 12%||Designed to ensure that workers save to purchase housing.|
In late 2011, the Chinese government announced that foreigners are to be included in the social insurance system at the same rates as Chinese citizens (excluding the housing fund); however, to date, implementation has varied by region.
Given the complicated requirements for social insurance contributions, many companies choose to outsource their payroll processing and related HR administration services. This has the added benefits of ensuring continuity (which can falter if an HR manager is absent or suddenly resigns), transparency and the confidentiality of salary information.
The Canadian Trade Commissioner Service in China recommends that readers seek professional advice regarding their particular circumstances. This publication should not be relied on as a substitute for such professional advice. The Government of Canada does not guarantee the accuracy of any of the information contained on this page. Readers should independently verify the accuracy and reliability of the information.
Content on this page is provided in part by Dezan Shira & Associates a pan-Asia, multi-disciplinary professional services firm, providing legal, tax, and operational advisory to international corporate investors.
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What benefits do employees get in China? ›
Mandatory employee benefits in China are state administered and they include retirement, medical care, unemployment, workers compensation, and maternity benefits. Supplemental employee benefits in China include three types of retirement benefits, life insurance and ADD, and healthcare.What are the wages in China? ›
In 2023, the highest minimum hourly wages in China were to be found in Beijing, Shanghai, and Tianjin municipalities with 25.3, 23, and 22.6 yuan respectively, whereas employees in Qinghai and Hainan provinces who received a minimum wage were paid the least – between 14.9 and 16.3 yuan per hour.How does wages work in China? ›
First, wages are set for individual cities, provinces and other administrative units by their respective local governments rather than on a nationwide basis. Next, each of these principalities is divided into a number of wage classes, whose minimum wages vary according to local socio-economic conditions.Does China have good wages? ›
China has lower average salary figures compared to other developed economies like the United States and Japan. The annual average wage of a typical Chinese employee is around 3,51,600 Yuan (USD 54,422).Does China provide social security? ›
Social insurance in China comprises of public health and public pension insurance, unemployment, work-related injury, and maternity insurance. In recent years, the Chinese government took major efforts to extend the coverage of social insurance.Does China pay Social Security? ›
Contribution Rates for the Chinese Social Security System. Chinese law requires Chinese employers and employees and foreign employees to contribute to China's social security system. If a company does not make these mandatory contributions, it can face serious consequences.What is the average wage in China in US dollars? ›
The average monthly pay in China is 29,300 Yuan (Chinese Yuan), which, using the exchange rate that was in effect in July 2021, is comparable to 4,534 USD (US dollars) in the United States.Are Chinese workers underpaid? ›
Low wages, long hours and excessive overtime remain the norm. Chinese workers have few, if any, options to seek redress and voice grievances under these harsh conditions. If workers step out of line, they may be fired without payment of back wages.Does everybody get paid the same in China? ›
Salary and Bonuses
Salary is very secretive in China as they do not pay everyone the same. As such they don't want people discussing how much they do or do not get paid and comparing salaries etc. This seems wrong (and it is) but it is the system that you'll be in.
|Living Wage - Single Adult||2800-4200||2510-4010|
|Living Wage - Typical Family||3920-5920||3650-5730|
|Real wage of low-skilled worker||-||-|
How much is rent in China? ›
|Expenses||Cost (USD)||Estimated Monthly Cost (USD)|
|Rent||$200 ~ $700||$200 ~ $700|
|Food||$2~$5 per meal||$100 ~ $150|
|Transportation||$,0.3~$0.5 each way (bus)||$30 ~ $50|
|Utilities||Electricity, water, gas, telephone, wi-fi||$50 ~ $100|
In 2021, China's GDP per capita was around $12,551, according to the National Bureau of Statistics (NBS), nearing that of a "high-income country" as defined by the World Bank and overtaking the global average GDP per capita of $12,100.Does China receive US aid? ›
In 2003 China received US$1.3 billion in aid, or about US$1 per capita. Like other countries in recent years, the United States has rapidly reduced its aid to China, reaching about $12 million from USAID for 2011.Does China provide free food? ›
China launched the Free Lunch for Children (FLC) Initiative in 2011 because students in remote poverty-stricken villages had to endure hunger because their families were too poor to afford lunch or their families were too far away from their schools.Does China pay retirement? ›
China has a two-tier pension system, consisting of a basic pension and a mandatory second-tier plan. It covers urban workers and many of the parameters depend on province-wide (rather than national) average earnings.Does China tax its citizens? ›
Residents are generally subject to China individual income tax (IIT) on their worldwide income. Non-residents are generally taxed in China on their China-source income only (see the Residence section for more information). An individual is taxed in China on one's income by category.Is there health insurance in China? ›
China's multi-level social HI system includes urban employee basic medical insurance (UEBMI) for the urban employed population and retirees, urban resident basic medical insurance (URBMI) for the urban unemployed population, and the new cooperative medical scheme (NCMS) for the rural population .Does China have basic income? ›
China becomes one of the first countries to successfully implement provisional Universal Basic Income for "most" of its citizens. The UBI program is funded primarily through taxation of the portion of business revenue generated through industrial, commercial or agricultural automation.How much tax do you pay in China? ›
|Income from Wages/Salaries||Progressive rates|
|CNY 0 - 3,000||3%|
|CNY 3,000 - 12,000||10%|
|CNY 12,000 - 25,000||20%|
|CNY 25,000 - 35,000||25%|
1 USD = 6.7753 CNY Feb 05, 2023 06:14 UTC
Check the currency rates against all the world currencies here. The currency converter below is easy to use and the currency rates are updated frequently. This is very much needed given the extreme volatility in global currencies lately. Sending money abroad is as easy as ever.
What is the cost of living in China compared to the US? ›
|Expenses||Cost (China)||Cost (USA)|
|Rent||$200 ~ $700||$500 ~$1,000|
|Food||$2~$5 per meal||$10 ~ $15 per meal|
|Transportation||$,0.3~$0.5 each way (bus)||$3 ~ $5 each way|
|Utilities||$50 ~ $100||$250 ~ $300|
Unemployment refers to the share of the labor force that is without work but available for and seeking employment. China unemployment rate for 2021 was 4.82%, a 0.18% decline from 2020. China unemployment rate for 2020 was 5.00%, a 0.48% increase from 2019.How are employees treated in China? ›
Workers regularly face a lack of formal employment contracts, wage withholding, excessive and illegal overtime, and a complete dependence on their employer for food and shelter. Wages are often withheld as long as a calendar year.Are Chinese workers happy? ›
We find not only that job satisfaction levels are relatively low, with only 46% of workers explicitly satisfied, but also that worker expectations differ significantly from what their jobs actually provide.What is China's minimum wage? ›
Minimum Wages in China averaged 1788.33 CNY/Month from 2006 until 2023, reaching an all time high of 2590.00 CNY/Month in 2021 and a record low of 690.00 CNY/Month in 2006. This page provides - China Minimum Wages- actual values, historical data, forecast, chart, statistics, economic calendar and news.Does China have a high standard of living? ›
China is now an upper-middle-income country. It will be important going forward that poverty alleviation efforts increasingly shift to addressing the vulnerabilities faced by the large number of people still considered poor by the standards of middle-income countries, including those living in urban areas.What is a good salary in China per month? ›
The average monthly pay in China varies from 7,410 Yuan (USD 1,145) to 1,31,000 Yuan (USD 20,245) — with 7,410 Yuan being the lowest salary and 1,31,100 Yuan being the highest salary.Is rent expensive in China? ›
Cost of living in China is, on average, 45.2% lower than in United States. Rent in China is, on average, 60.9% lower than in United States.What is China's average income per person? ›
Per capita disposable income of households in China 1990-2022. In 2022, the average annual per capita disposable income of households in China amounted to approximately 36,883 yuan. Annual per capita income in Chinese saw a significant rise over the last decades and is still rising at a high pace.Does China provide free housing? ›
The government now provides affordable housing by subsidizing commercial housing purchases or by offering low-rent public (social) housing to middle- and low-income families. At the same time, it relies on the private commercial housing market to meet the needs of higher-income groups.
How long do you own a house in China? ›
“Owning” might not be the right term, as in China, property is simply leased for the duration of 70 years. After this time, the lease is usually renewed. However, the Ministry of Housing and Construction can theoretically nullify your lease at any time if your property is needed for development.Do Americans own land in China? ›
Foreign investors are not allowed to buy land in China. The land in China belongs to the state and the collectives.How much is poverty in China? ›
China Poverty Rate 1990-2023.
|China Poverty Rate - Historical Data|
|Year||% Under US $5.50 Per Day||Change|
As of January 2022, the largest share of Chinese middle-class families had an annual income of between 100 thousand and 300 thousand yuan per year.Is the poverty rate in China High? ›
Poverty in China
According to the latest data supplied by the World Bank, only 0.6 percent of the Chinese population lived below the country's official poverty line of having less than $2.30 at their disposal per day.
China has a two-tier pension system, consisting of a basic pension and a mandatory second-tier plan.Does China have good work life balance? ›
In the eyes of most people, Chinese people always work very hard for long hours every day. And that's indeed a fact. In the West, employees generally work 5 days a week, 7-8 hours a day, but in China, most employees only take one day off a week and may work up to 10 hours a day.Do Chinese workers have health insurance? ›
China does have free public healthcare which is under the country's social insurance plan. The healthcare system provides basic coverage for the majority of the native population and, in most cases, expats as well. However, it will depend on the region you reside in.How much is Social Security in China? ›
|Corporate Tax Rate||25.00||percent|
|Sales Tax Rate||13.00||percent|
|Social Security Rate||39.02||percent|
|Social Security Rate For Companies||28.52||percent|
China does not have a 401k per se. However, China does have a pension fund system. The pension fund in China is a contribution made throughout a citizen's working-life in preparation for retirement.
Does China have poor working conditions? ›
Workers are routinely exposed to a variety of dangerous working conditions that threaten their health and their safety. Low wages, long hours and excessive overtime remain the norm. Chinese workers have few, if any, options to seek redress and voice grievances under these harsh conditions.Is unemployment high in China? ›
Unemployment Rate in China averaged 4.69 percent from 2002 until 2022, reaching an all time high of 6.20 percent in February of 2020 and a record low of 3.90 percent in September of 2002.Do Chinese work 7 days a week? ›
Working life in China is usually centred on a 40-hour week spread across five days (most often Monday to Friday). General banking hours are Monday to Friday from 8am to 5pm. A standard working day is eight hours long.Do you get free healthcare in China? ›
Basic public health service package is provided to all Chinese residents free of charge.How is healthcare paid for in China? ›
Public insurance and steps toward universal healthcare
These are made up of voluntary public insurance and mandatory public insurances. Urban Employee Basic Medical Insurance is financed mainly from employee and employer payroll taxes, with minimal government funding.