As September begins, two more regions are adjusting their minimum wage standards. Starting September 1, Guangdong and Yunnan officially implemented new minimum wage rates. In Shenzhen, the monthly minimum wage rose from 2,520 yuan to 2,700 yuan, while Guangzhou increased from 2,500 yuan to 2,680 yuan. The hourly minimum wage for part-time workers in both cities was raised to 25.4 yuan. Yunnan increased its three-tier monthly minimum wages to 2,270 yuan, 2,120 yuan, and 1,970 yuan respectively.

Earlier this year, Jiangsu, Zhejiang, and Shaanxi implemented new standards effective January 1. Together with Guangdong and Yunnan, five provinces have now rolled out new minimum wage levels in 2025. Shanxi and Xinjiang have also announced adjustment plans, both set to take effect on October 1.

The impact of a minimum wage increase extends beyond just the base pay figure. Calculation standards or minimum guarantee lines for certain benefits—such as unemployment insurance, sick leave pay, and economic compensation—are linked to local minimum wage levels to varying degrees. However, this does not mean that all wage-related benefits will rise in tandem automatically.

Guangdong and Yunnan implement new standards in September, with five provinces adjusting this year

Following this adjustment, Guangdong has divided its minimum wage standards into three categories. Guangzhou and Shenzhen fall under the first tier, with Guangzhou's monthly minimum at 2,680 yuan and Shenzhen's at 2,700 yuan, both with a part-time hourly minimum of 25.4 yuan. Zhuhai, Foshan, Dongguan, and Zhongshan fall under the second tier with a monthly minimum of 2,300 yuan. The remaining 15 cities operate under the third tier, set at 2,040 yuan per month.

Guangdong's previous minimum wage standard was implemented in March 2025. Compared to that round, both Shenzhen and Guangzhou have seen their monthly minimum wages rise by 180 yuan. Yunnan continues to divide its regions into three tiers based on economic development levels at the county level. The three monthly minimum wage tiers have increased from 2,170 yuan, 2,020 yuan, and 1,870 yuan to 2,270 yuan, 2,120 yuan, and 1,970 yuan respectively, with part-time hourly minimums rising to 22 yuan, 21 yuan, and 20 yuan.

Earlier in the year, Jiangsu, Zhejiang, and Shaanxi began enforcing new standards from January 1. Jiangsu and Zhejiang both raised their top-tier monthly minimum wage to 2,660 yuan, while Shaanxi's top tier increased to 2,376 yuan. Additionally, Shanxi and Xinjiang have confirmed they will enforce new standards starting October 1.

As of September 2, five provinces—Jiangsu, Zhejiang, Shaanxi, Guangdong, and Yunnan—have implemented new minimum wage standards this year, with Shanxi and Xinjiang having announced but not yet enforced their adjustments.

Who does the monthly versus hourly minimum wage apply to? Overtime pay and allowances cannot be used to meet the requirement

According to the Minimum Wage Regulations, the minimum wage is the lowest remuneration an employer must legally pay a worker who provides normal labor within statutory working hours or the working hours agreed upon in the labor contract. The monthly minimum wage applies to full-time workers, while the hourly minimum wage mainly applies to part-time workers.

Certain special employment arrangements cannot fall below this threshold either. The Labor Contract Law of the People's Republic of China stipulates that wages during a probation period must not be lower than the minimum wage for the same position at the company or 80% of the wage agreed in the labor contract, and must also not be lower than the local minimum wage standard. For units operating under piece-rate or commission-based pay, wages paid to workers providing normal labor must also meet the corresponding minimum wage standard.

At the same time, overtime pay, allowances for special working environments such as middle and night shifts, high temperatures, low temperatures, underground work, and toxic or hazardous conditions, as well as benefits stipulated by laws and regulations, cannot be used to "top up" the minimum wage. For example, if a worker in Shenzhen earns 2,400 yuan for normal working hours plus 300 yuan in overtime pay, even though the total income reaches 2,700 yuan, it does not satisfy the new minimum wage requirement. After excluding overtime pay, the wage for normal working hours must still reach the local minimum wage standard.

Whether personal contributions to social insurance and housing provident fund are included in the minimum wage varies by region. Yunnan explicitly states that the minimum wage includes social insurance premiums and housing provident fund contributions that workers are legally required to pay individually. Jiangsu, however, specifies that the minimum contribution portion of the housing provident fund is not part of the minimum wage and must be paid separately by the employer. Shenzhen has its own approach: social insurance premiums that employees are legally required to bear can be deducted from wages, and for workers paid at the local minimum wage, employers must still contribute to the housing provident fund, while employees may be exempt from personal contributions as per regulations.

Therefore, the minimum wage standard does not directly equate to a worker's actual take-home pay—local rules must be consulted for accurate determination.

After a minimum wage increase, will unemployment benefits, sick leave pay, and economic compensation all rise?

After a minimum wage adjustment, benefits that may actually change fall into two main categories: those whose calculation formulas are directly tied to the minimum wage, and those where the minimum wage serves as the lowest guarantee line.

Shenzhen's unemployment insurance falls into the first category. The Shenzhen Social Insurance Fund Administration has clarified that unemployment benefits are calculated at 90% of the minimum wage. With Shenzhen's minimum wage rising from 2,520 yuan to 2,700 yuan, unemployment benefits have increased from 2,268 yuan per month to 2,430 yuan per month. Since unemployment benefits are paid on a "next month for the previous month" basis, September payments still reflect August's rate at 2,268 yuan. Starting with October payments for September benefits, the new rate of 2,430 yuan will apply without any need for recipients to reapply.

Sick leave pay relates to the minimum wage more as a safety net. Under current Shenzhen regulations, sick leave wages during the medical treatment period must not be lower than 60% of the worker's normal working-time wage, and simultaneously not lower than 80% of Shenzhen's minimum wage. With the minimum wage rising to 2,700 yuan, this minimum guarantee line has increased from 2,016 yuan to 2,160 yuan. However, this does not mean all workers' sick leave pay increases uniformly—if the calculated amount based on 60% of normal working-time wages already exceeds 2,160 yuan, the higher figure prevails.

Economic compensation follows similar logic. According to the Regulations on the Implementation of the Labor Contract Law of the People's Republic of China, if the average monthly wage in the 12 months before contract termination or dissolution falls below the local minimum wage, economic compensation is calculated based on the local minimum wage standard. Thus, a minimum wage increase raises the floor for economic compensation calculations but does not automatically boost compensation for all workers. Those whose average wages are already significantly above the minimum wage are typically unaffected.

Some items will not automatically change due to a minimum wage adjustment. For instance, while overtime pay cannot be counted toward the minimum wage, a higher minimum wage does not mean everyone's overtime pay increases proportionally. Whether high-temperature allowances or night shift allowances adjust depends on specific local regulations. Social insurance contribution bases also do not uniformly rise for all employees. Contribution bases are generally determined by individual wages within statutory upper and lower limits, and whether the minimum contribution base for certain insurance types changes with a minimum wage adjustment depends on local rules. The housing provident fund operates on its own adjustment cycle as well. In Shenzhen, for example, the contribution base is generally determined by the average monthly wage from the previous year. The September 1 minimum wage adjustment does not mean contribution bases change for everyone that same month.

To determine whether a benefit will rise with the minimum wage, the key is whether laws, regulations, and local policies explicitly incorporate the minimum wage into the calculation formula or designate it as the minimum guarantee standard.

Why do standards differ within the same province? How often is the minimum wage adjusted?

The minimum wage standard is not determined solely by price levels. The Labor Law of the People's Republic of China and the Minimum Wage Regulations require that several factors be considered when setting or adjusting the minimum wage, including the minimum cost of living for workers and their dependents, consumer prices, average worker wages, social insurance premiums and housing provident fund, economic development levels, and employment conditions.

Due to differences in economic development, wage levels, living costs, and employment conditions across regions, minimum wage standards vary from province to province, and a single province can have multiple tiers. Guangdong has divided the province into three categories, with Guangzhou and Shenzhen at the highest tier, while Yunnan has three tiers based on economic development at the county level.

The minimum wage is not mechanically raised at set time intervals either. The current Minimum Wage Regulations originally required adjustments at least once every two years. In 2015, the Ministry of Human Resources and Social Security, responding to economic conditions, proposed shifting the adjustment frequency to at least once every two to three years. This represents a minimum frequency requirement—it does not mean adjustments must wait a full two or three years. If relevant factors change, local governments can adjust in a timely manner based on actual circumstances.

Guangdong serves as an example. Its previous minimum wage standard was implemented in March 2025, and the new adjustment in September 2026 comes roughly a year and a half later. Overall, a minimum wage increase first raises the statutory "floor" for wage distribution. For workers earning at or near the minimum wage, the impact is most direct. For others, whether they benefit depends on whether systems for unemployment insurance, sick leave pay, and economic compensation include mechanisms tied to the minimum wage.