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Shenzhen may raise its minimum monthly wage within the special economic zone (SEZ) to 850 yuan (US$105) in July, the municipal labor and social security bureau said Monday.

If implemented, this proposed minimum wage would be the highest in the nation, said Liu Qing, vice director general of the labor bureau. The minimum wage of the SEZ now ranks second on the mainland, after Shanghai.

The proposal, one of the two pay rise proposals made at a public hearing Monday, represents a 23.19 percent rise over the current minimum wage for the SEZ. The proposal also includes raising the minimum wage outside the SEZ by 29.31 percent to 750 yuan a month.

However, most participants in the hearing objected to the proposal, saying that it would pose a heavy burden for companies. They preferred the other proposal, which raises the minimum monthly wage within the SEZ to 800 yuan and that outside the SEZ to 700 yuan.

The 800 yuan/700 yuan minimum wage could reduce Shenzhen's competitive edge in comparison to other Guangdong cities, which also have plans to greatly raise their minimum pay. Guangzhou, where the minimum monthly wage is six yuan lower than Shenzhen, plans to raise the minimum wage to 800 yuan. Foshan, Dongguan, Zhuhai and Huizhou, where the minimum wages are lower than Shenzhen's two districts outside the SEZ, are expected to raise their minimum monthly salary to 700 yuan.

The average income of workers is much higher than the minimum wage, with many people working overtime.

A survey by the labor bureau showed that the average monthly salary within the SEZ is 2,175 yuan and that outside the SEZ is 1,034 yuan.

The average monthly expenditure of a worker in Shenzhen is 1,568 yuan inside the SEZ and 703 yuan outside the SEZ, according to the bureau.

Shenzhen entrepreneurs earn more money than those in most other Chinese cities, statistics show. In 2003, 51.32 percent of the city's GDP went to companies, a higher proportion than in Beijing, Shanghai, and Guangzhou. Only 33.62 percent went to employees, a lower proportion than in these cities.

Participants at Monday's hearing included legislators, political advisers, employers, employees, and representatives from trade associations.

The labor bureau said it had polled over 20,000 grassroots workers before coming up with the two proposals.

The bureau will report the final figure to higher authorities early next month and after approval, the pay rise will be implemented July 1.

(Shenzhen Daily April 19, 2006)