2011-03-03 22:15

SHENZHEN - China's southern economic powerhouse Shenzhen said Thursday it would raise the minimum wage by 20 percent, following a similar move by Shanghai, as China continues to battle rising inflation and a labor shortage.

The hike, effective from April 1, would bring the minimum monthly wage in the city to 1,320 yuan ($200) from the current 1,100 yuan, the highest minimum wage in the country, Shenzhen's Human Resources and Social Security Bureau reported.

It is Shenzhen's largest one-time wage hike over the past 19 years, official statistics show.

A human resources official who declined to be named said the wage hike aims to make jobs in Shenzhen more attractive to solve the current labor shortage facing cities on China's manufacturing belt on the country's southeastern coast.

Minimum wages have been rising around the country since last year in the wake of labor shortages and surging inflation.

The consumer price index (CPI), a major gauge of China's inflation, rose 4.9 percent in January from a year earlier as food prices increased 10.3 percent due to rising demand and a drought in key grain-growing regions.

On Wednesday, Shanghai announced that it would raise the minimum wage by 14 percent to 1,280 yuan from the current 1,120 yuan.