Now! China - Insights into China's Salary Trends and Benchmarks [Issue No.35]

National Enterprise Salary Overview

Based on recent data from the National Bureau of Statistics of China, here is a comprehensive look at average salaries across different enterprise categories in 2023.

Statistical Scope:

Covered Population: The labour wage statistics cover the employment and wage data of legal entities. Individual employed personnel, freelancers, and other non-unit employed individuals are not included in the scope of these statistics.

Urban Non-Private Legal Entities: This category includes domestic-funded units (such as government organisations and public institutions), enterprises funded by Hong Kong, Macao, and Taiwan, as well as foreign-funded enterprises. Private units are excluded from this classification.

Urban Private Legal Entities: This category consists of private limited companies, private joint-stock companies, sole proprietorship enterprises, and partnership enterprises within the group of domestic-funded enterprises.

2023 Average Wages in Major Cities

As of October 2024, several cities in China have reported social average wage data for 2023. These figures, approved by local human resources and social security bureaus, reflect the average wages used for social insurance calculations across major cities.

2024 China Market Salary Growth Forecast

On 20 September 2024, Mercer Consulting released its 2024-2025 China Market Overall Compensation Research. Key findings include:

• 2024 Salary Growth: The actual salary growth rate in China for 2024 was 4.3%, 0.7% lower than the 2024 forecast made in the previous year.
• 2025 Salary Forecast: The growth rate is projected to be 4.4%, positioning China at the median level in the Asia-Pacific region.

Mercer’s findings are based on responses from nearly 4,000 surveyed companies in China.

China Updates

Accounting and Taxation

• Announcement on Promoting the Use of Fully Digitalised Electronic Invoices for Railway Passenger Transport

On 29 September 2024, the State Taxation Administration, the Ministry of Finance and the China State Railway Group Co., Ltd. issued an Announcement aimed at promoting the use of fully digitalised electronic invoices for railway passenger transport. The key points of the announcement are as follows:

• Eligible Entities: Railway transport enterprises, non-holding joint venture companies, and local railway enterprises under the State Railway Group ("railway transport enterprises") are authorised to issue electronic invoices during the sale, refund, and exchange of tickets for domestic passenger transport through the railway passenger ticket selling and booking system.
• The content of the railway electronic invoice includes:

1. Invoice number (20 digits)
2. Invoice date
3. Purchaser's information
4. Passenger's ID number
5. Journey information
6. Ticket price
7. QR code

• Issuance of Electronic Invoices: Railway transport enterprises will issue railway electronic invoices based on the purchasers’ name, unified social credit identifier, and journey details. These invoices will be provided via the 12306 railway platform or email, with passengers able to inquire and download invoices through the 12306 railway platform or the personal ticket folder in the individual income tax APP.
• Reimbursement: Passengers needing reimbursement must obtain railway electronic invoices. Paper tickets issued before 30 September 2025 will still be accepted for bookkeeping purposes. Paper tickets and electronic invoices cannot be issued for the same journey.
• VAT Deduction: General VAT payers purchasing domestic railway passenger transportation services must use railway electronic invoices for VAT deduction. The input VAT will be calculated based on prevailing VAT policy. For paper railway tickets issued before 30 September 2025, input VAT will follow the existing VAT reform policies.
• Red Invoice: If an error is found in a previously issued railway electronic invoice, the railway transport enterprises will issue a red invoice to correct the mistake.
• Effective Date: This provisions outlined in this announcement are effective from 1 November 2024.

Human Resources

• Notice on Participation of Older Unemployment Insurance Recipients in Basic Old-Age Insurance for Enterprise Employees

On 26 October 2024, the Ministry of Human Resources and Social Security, the Ministry of Finance, and the State Administration of Taxation issued a notice addressing the participation of older unemployment insurance recipients in the basic old-age insurance for enterprise employees.

The circular defines elderly pensioners as unemployed people who are receiving unemployment insurance and are less than one year away from the statutory retirement age. These individuals will be allowed to participate in the basic old-age insurance for enterprise employees as individuals, provided they are in locations where they receive unemployment insurance benefits. The circular also specifies that the unemployment insurance fund will cover the portion of the minimum contribution standard for local flexible employees. Furthermore, the notice outlines measures to enhance policy notification, improve handling services, and bolster risk prevention and control. The policy will take effect on 1 January 2025 and remain in force until 31 December 2039.

Corporate Governance

• On 23 October 2024, the Ministry of Industry and Information Technology (MIIT) held a symposium to officially launch a pilot program aimed at expanding the opening-up of value-added telecommunications services in Beijing, Shanghai, Hainan, and Shenzhen.

This initiative marks the first time where the business scopes of Internet Data Centers (“IDC”) and their sub-category, Internet Resource Collaboration Services (“IRCS”), are opened to foreign capital outside of Hong Kong and Macao. The four pilot regions—Beijing, Shanghai, Hainan, and Shenzhen—have the flexibility to implement the pilot opening-up program in a differentiated and phased manner, aligning their unique own development objectives and resource capacities.

The program’s primary goals include driving development, reform, and innovation through expanding regional access, strengthening the construction and application of information infrastructure, attracting foreign investments, and contributing to high-quality economic development in these regions.Better aligning domestic rules with high-standard international economic and trade rules.

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