Beijing’s Monthly Minimum Wage Increased
The minimum wage rate in Beijing is set to rise again: what should businesses with employees in China expect?
Beijing has increased its minimum wage rate every year since 2010, and 2019 will be no exception. On 9 May, the Beijing Municipal Human Resources and Social Security Bureau announced that the city’s monthly minimum wage would rise from 1 July, 2019 - from RMB 2,120, to RMB 2,200. The monthly wage rate applies only to full-time employees: the hourly wage rate for part-time employees in Beijing remains the same at RMB 24 on work days, and RMB 56 on statutory holidays.
The announcement accompanies similar increases in regions across China. In 2019, Shanghai raised both its hourly and monthly minimum wage rates, while the southwestern Chongqing municipality and the northwestern Shaanxi province both raised their monthly minimum rates.
Wage Increases Slowing
Beijing is the most recent of China’s wage increases with the rise taking its monthly rate equal to Shenzhen, and second only to Shanghai (RMB 2,580) in the Chinese mainland.
While the increase of RMB 80 in 2019 represents a 0.38% rise in Beijing’s minimum wage rates, that rise was 6% in 2018. The latest increase contributes to a slowdown in the district’s minimum wage - both monthly and hourly - over the past decade:
| Introduction Date |
Monthly minimum wage rate (RMB) |
Hourly Minimum wage rate (RMB) |
Hourly holiday minimum wage rate (RMB) |
|---|---|---|---|
| July 2010 |
960 |
11 |
25.7 |
| January 2011 |
1,160 |
13 |
30 |
| January 2012 |
1,260 |
14 |
33 |
| January 2013 |
1,400 |
15.2 |
36.5 |
| April 2014 |
1,560 |
16.9 |
40.8 |
| April 2015 |
1,720 |
18.7 |
45 |
| September 2016 |
1,890 |
21 |
49.9 |
| September 2017 |
2,000 |
22 |
52.6 |
| September 2018 |
2,120 |
24 |
56 |
| July 2019 |
2,200 |
24 |
56 |
China’s Wages and Social Insurance Explained
Minimum wage rates vary across China, along with their associated social insurance contributions. Both employees and employers contribute to social insurance (medical and unemployment insurance), and the housing provident fund, while only employers contribute to employment injury and maternity insurance. The relevant contributions from employee wages must be withheld by payroll during every pay-cycle.
Certain regions include social insurance and provident fund contributions in employees’ basic wages, while others do not. Beijing is one of the regions that does not include these additions, meaning employers must set-up their payroll to add them to employees’ base salaries. There are indications that social insurance contributions will increase in China over the coming years.
Beijing and Beyond
The Human Resources and Social Security Bureau has a requirement to adjust the minimum wage standard across China at least once every two or three years, and may do so based on the prevailing economic situation.
In 2019, the various wage adjustments implemented across the country have taken the monthly wages of six regions above RMB 2,000. In addition to Beijing this includes Shanghai, Tianjin, and the provinces of Guangdong, Jiangsu, and Zhejiang. Similarly, four regions now have a minimum hourly wage of more than RMB 20, those being Beijing, Shanghai, Tianjin and Guangdong province.
To learn more about tax and social insurance contributions in China, browse our dedicated Global Insight Guide.