Guangdong, China's biggest export centre, announced yesterday it would raise the provincial minimum wage by an average of more than 20 per cent.
The move comes amid worries about inflation in China and complaints from factories in Guangdong and elsewhere about unfilled jobs as they rush to complete a surge in orders since February.
“A lot of our workforce traditionally come from the poorer regions in western China, but factories are moving out there to take advantage of cheaper wages and lower taxes,” said Au Yiu-chee of Hong Kong, who owns a textile factory in Dongguan, a manufacturing centre.
Mr Au said he had only about a third of the workers required to complete an order due in May from a European brand. The People's Daily, the Communist party's flagship newspaper, has reported that factories in the Pearl River Delta have more than 2m unfilled positions.
Guangdong, which abuts Hong Kong, said the wage rise would help attract workers from other areas and improve the lives of low-income earners faced with rising inflation. China's consumer price index rose by 2.7 per cent in February from a year before, the most in 16 months.
Jiangsu province, the region near Shanghai, and one of Guangdong's closest export rivals, last month raised its monthly minimum wage rate by 13 per cent to Rmb960 ($140,