It seems fine to me.
Ultimately having a firm floor is not a bad idea in a nation that still has significant wealth and income disparity.
Chinese Economics Thread
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It seems fine to me.
Ultimately having a firm floor is not a bad idea in a nation that still has significant wealth and income disparity.
For me it's certainly not fine if it's below the market clearing rate, what's even the point with that kind of minimum wage?
You have Shanghai and Beijing with 2420 RMB minimum wage and 2700 RMB minimum wage, this lvl is ridiculous for these world class cities because even the most crap jobs there pays at least 5000-6000 RMB., so market clearing rate it's 2x!. GDP per capita in these regions and cities are higher than in Poland, or comparable if you say Jiangsu, but minimum wage should be at least 2x the current amount to have even a closiness to the market clearing rate wage.
Poland is maybe not good example for it, cause the minimum wage skyrocketed in the recent years, and a lot of people got caught by the lvl so about 25% of workforce are working for this wage +-700zł. But right now in Poland you have 4300 zł minimum wage and that's 7700 RMB!, it will rise to 4666zł from next year. Shanghai, Beijing, Jiangsu, Zhejiang at similar lvl of per capita GDP should have at least minimum wage at market clearing rate to have some impact on the market and the most low paid jobs.
That low lvl, only makes anti-China articles/pundits in Western media or goverments go with dumb Michael Pettis overcapacity and not enough demand thesis further. The good ratio of China disposable income per capita to GDP per capita in China clearly proves that minimum wage has zero impact on the Chinese wages, which are much higher.
Minimum wage, just a bit higher than very poor so called "3rd" world countres, makes China unfortunately look bad, even though the reality on the ground is different, and it have no impact on real income.
My point, China minimum wage should be set on at least 5000-6000 RMB in first tier cities such as e.g. Shanghai, Beijing, Shenzhen etc. 4000 in lower, and 3000 RMB in the poorest regions of China to have any impact on wages (market clearing rate wage), so double the current lvl of minimum wage rates at least.
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Having a minimum wage floor is still better than having no floor at all. If it has zero impact on the actual wages because in reality the market will pay more then... That's a good thing?
If the question is one of "looking bad" then I would argue that is not particularly relevant or even a priority for the Chinese government.
This all sounds like reputational frivolity.