China: Wage Increase of 8.1 percent expected

Beijing / Shanghai / Guangzhou – According to the Wage and Salary Survey 2014, conducted by the German Chamber of Commerce in China between August 25th  and September 26th, German companies expect an average wage increase of 8.1% in 2015. In addition, they state that maintaining productivity growth and developments in the area of collective actions become increasingly challenging. The survey analyzed wage levels and wage increases for 36 job categories as well as related HR issues.

The results of the poll with a total of 356 responses, show an expected average wage rise of 8.1%, a slowdown of 0.7 percentage points compared to actual wage increases of 8.8% in 2014. In general, wage growth has dropped across all regions and positions. These findings are in line with the recent cooling of the Chinese economy. When analyzing job classifications, the survey reveals that wage increases for workers (8.8%) and junior level staff (8.1%) are expected to be higher than the increases for mid-level (7.9%) and senior-level (7.6%) positions. Looking at job categories, wages in production related (8.8%) and engineering (8.3%) jobs will grow faster in comparison to other occupational groups.

This year more companies (40.7%) state that productivity growth has been outpaced by wage increases. Consequently, the importance of automation to achieve future productivity growth rose by 13.7 percentage points.

Wage levels at German companies are among the highest in China

Wage levels for blue collar workers are 2.9 times higher than local minimum wages across all regions. Survey data also suggest that German employers have higher compensation rates than the average within regions and foreign enterprises. In regards to specific sectors, chemical and automotive report the highest wages against the national average.

HR problems continue to be a pressing issue

Structural deficiencies in the Chinese labor market have led to significant HR problems. As in previous years in addition to rising wage levels the recruitment and retention of qualified staff continue to be the most pressing issues for German companies. 51.2% say it is difficult to fill vacancies especially in technical areas. In addition, developments in the areas of collective actions further challenge German companies. 10.2% have been directly affected by labor unrest in the first 8 months of 2014. Furthermore, 32.2% of survey respondents established a trade union, of which 41.9% were pressured to do so.

German Chamber of Commerce in China

The German Chamber of Commerce in China is the official member organization of German companies in China. By providing up to date market information and practical advice the German Chamber helps its members to succeed in China. It offers a platform for the Sino-German business community and represents its members’ interests towards stakeholders including government bodies and the public. Infos: