The minimum wage will be increased in an effort to help ease the worsening labor shortage in the booming southern city of Shenzhen.

Workers are going to where salaries are higher and around 100,000 jobs in Shenzhen could be vacant. The local government has decided to raise the minimum wage in the special economic zone to 690 yuan (US$83) per month, up from 610 yuan (US$74) with effect from June 1.

The minimum wage in Guangzhou is 684 yuan (US$83) and Shanghai's is 635 yuan (US$77).

Workers in Shenzhen's two other districts, outside the designated special economic zone, must receive at least 580 yuan (US$70) per month, up 20.8 percent from the previous 480 yuan (US$58), according to the Shenzhen Municipal Bureau of Labor and Social Securities.

More than 4.3 million workers are registered with local labor administrations, but only a quarter of them work in the special economic zone, official figures indicate.

Huang Zaoji, deputy director of the bureau, said the minimum wage is being raised "because we will find ourselves in an unfavorable situation amid the fierce competition for workers if Shenzhen keeps minimum salaries low."

Last year, in an effort to attract workers from inland regions, cities in the country's two industrial boom areas, east China's Yangtze River Delta area and south China's Pearl River Delta area, raised the minimum wage well above Shenzhen's level at the time.

According to a recent survey by the bureau, companies in Shenzhen, especially labor-intensive factories, could be short of a total of 100,000 workers. The situation could get worse if the government does nothing to entice laborers to the area.

"We believe the adjustment is rational and the revised minimum salary is attractive to laborers. It will definitely give them enough to live on," said Xu Shaoying, a deputy director of the local labor bureau.

Official figures show the average income of a Shenzhen employee reached 1,208 yuan (US$146) per month last year, including 273 yuan (US$33) in overtime pay.

Xu warned that firms that fail to pay the minimum wage could be fined up to 50,000 yuan (US$6,000).

(China Daily June 1, 2005)