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How Much Do Workers Make In China?

written by John Chow on May 22, 2008

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The Nameless Factory Worker

This is where many young village girls end up if they leave the family farm. China has thousands of factories that manufacture every product known to man (and some that are not known). These factories employ a mostly female workforce because women are easier to control.

The workers are paid an average of 1000RMB per month plus housing and food. Since these factories are huge and the only things near by are more factories, there’s really no where for the girls to spend their money. Most will send the funds back home to help their families.

The jobs are very repetitive and I’m sure extremely boring. However, it pays many times more than working on the farm back home. Add in the fact that the living costs are zero since the company provides food and housing and the girls find themselves in a situation many American workers can’t seem to reach – positive cash flow.

The Nameless City Worker

Jobs in the city pay more than jobs at the factories. However, the cost of living in the city is much higher as well. It’s not uncommon to find 4 or 5 people sharing a small apartment. Most unskilled jobs in Shanghai pay 1000 to 2000 RMB per month. Because of the low wages for unskilled workers, business create a lot of redundancy by employing a bunch of them. The restaurant industry is a prime example. They’ll have multiple greeters at the door and who knows how many more waiters inside. On our train ride to Suzhou, there was a greeter at every single train car.

While the unskilled city worker may have access to far more entertainment choices than one of the 250,000 workers at the iPod factory, they generally don’t make enough to really entertain themselves.

The English Speaking Worker

In a city like Shanghai, being able to speak English opens up a world of new possibilities for the Chinese worker. Speaking English also means more money – 3000 to 5000 RMB per month. For example, in order to work at the Grand Hyatt Shanghai, all employees (except cleaning staff) must be able to speak English or another language. The Grand Hyatt pays a lot more than a local hotel. Then again, they charge a ton more too!

A worker can make more money if he has a collage education. However, even if the worker is unskilled, as long as he can speak English, he’s worth more than three times an unskilled worker.

The Western Educated Worker

At the high end of the working class is the western educated worker. An English speaking employee with a western education is highly prized in China. Wages start at 17,500 RMB per month and many times, the company will pay for all or part of the housing cost. In a country where the average factory wage is 1,000RMB per month, starting at 17,500 puts these workers in a very elite class.

It used to be that most western educated Chinese student would stay in the West after graduation because the opportunities are greater. However, this is no longer the case and most students now choose to return home after getting their degree. Look at it this way. A new grad will make the same wage working in the US or China. However, the wage of the new grad in the US isn’t 17.5 times greater than the average US factory worker. Chances are, the US factory worker makes more than the grad.

The great need for educated employees has allowed many US and Canadian citizens to seek work in China. You can expect your wages to be about the same as what you would make working at home. However, because the cost of living is so much lower, you can live pretty high on the hog. That is, as long as you stay away from Pudong. :twisted:

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{ 50 comments }

Stak Loaded: How to make money doing nothing! May 22, 2008 at 11:12 am

Damn that sucks, is there any way for them to move up or are they pretty much stuck living in poverty if they were born into it?

Affiliate Confession May 22, 2008 at 12:24 pm

Sonds like they all need to start blogs and be Dot Com Moguls like John.

Michael Kwan May 22, 2008 at 3:42 pm

Being stuck behind the great firewall of China makes that quest a little more challenging.

The Berry Tree May 22, 2008 at 4:10 pm

They can always use proxies

Stak Loaded - How to make money doing nothing! May 26, 2008 at 12:38 am

ROFL at proxies :lol:

HustleStrategy May 23, 2008 at 4:12 am

The world is “flat” they say. It shouldn’t be too hard, they do not have to live here or ever come here.

MR. NICE GUY May 25, 2008 at 1:59 am

JOhn is indeed very lucky to have moved in other country and become a man of power in his chosen field. I guess John has a lot of motivations for the chinese work force. hehehe

Thiago Prado May 22, 2008 at 11:15 am

there’s amazing the salary difference between the unskilled people and the graduated ones. Some years ago in Brazil we had the same problem however the new President is trying to change the idea of third world country and paying more money to unskilled workers.

Joe May 22, 2008 at 11:24 am

I can’t imagine making what I make now and having that be an “elite” class of salary. It’s incredible!

Affiliate Confession May 22, 2008 at 12:26 pm

I think 17,500 RMB is only around $2,500 per month US. Wow, that’s a pretty low wage to be in the elite.

Ed Lau May 22, 2008 at 12:40 pm

Seems like it but consider that the cost of living in China is next to nothing. $2,500 a month can have you living like an emperor there.

Stephen May 22, 2008 at 1:51 pm

I’m sure that can get you a lot of your favourite “Beautiful Girls (or Boys)” directly to your Hotel Room. :lol:

Michael Kwan May 22, 2008 at 3:48 pm

Even within Canada and the United States, there are huge disparities in the cost of living. The average single detached home in Vancouver is over $700,000. The same house placed in small town Texas could probably be had for less than a quarter of that.

Paul B May 22, 2008 at 1:29 pm

There are lots of places in the world where $2500 is a pretty good wedge, just a shame the UK isn’t one of them

HustleStrategy May 23, 2008 at 4:10 am

Not even close in the UK

wisdom May 22, 2008 at 11:53 am

The population of china is over 3 billion, pretty crazy…. however only about 162 million or so have access to the internet… I didnt know that ppl are now going to work in China who are educated, thanks for the info John.

Affiliate Confession May 22, 2008 at 12:29 pm

I don’t think it’s quite that many people, more like 1.3 billion. Still a bunch though.

The Berry Tree May 22, 2008 at 4:12 pm

Damn that sucks. Don’t they have free internet cafe’s and stuff?

Howard May 23, 2008 at 1:50 am

Wow, that’s the most ignorant and retarded comment I’ve seen for quite a while. I don’t read Youtube, you understand.

I presume you think China got so financially and politically powerful solely through mass producing teddies and ipods? Oh dear.

Paul B May 22, 2008 at 11:59 am

I always thought that in a communist country the workforce and wages were fixed? How much unemployment is there in China?

Michael Kwan May 22, 2008 at 3:50 pm

I’d imagine that most people are employed in some way, but the wages are ridiculously low for most of them.

Howard May 23, 2008 at 1:53 am

“I always thought that in a communist country the workforce and wages were fixed? How much unemployment is there in China?”

So communist they’re buying out American companies…

Financial Jesus May 23, 2008 at 3:58 am

Actually China is not a communist country in the sense the Soviet Union was.
China is a communist country but its economy is more or less a free market type – the government only gets involved when it has to.
Being a country with a communist government and capitalism at the same time can actually be a good thing in terms of economic prosperity.
It is a lot easier for a communist government to handle the tough and unpopular decisions than for a democratic government. For example during the building of the worlds largest dam China had to relocate more than 1 million people. Imagine that happening in the US – the debate whether or not you should do it would take more than 10 years

Flimjo May 22, 2008 at 12:18 pm

Fascinating stuff, John. Your blog for the past couple of weeks has become an educational resource on China. Thanks for all this information.

Pete May 22, 2008 at 12:23 pm

Seems as if this is following almost the same trend as Taiwan over the past 20-40 years, except Taiwan had a tougher time getting students that it sends overseas to study to return.

Binary Ant May 22, 2008 at 12:25 pm

It’s incredible the salary difference. If a local worker lives with 1000RMB then a person who earns 17,500RMB is almost rich!! isn’t it?

Affiliate Confession May 22, 2008 at 12:32 pm

They’re more than rich, they’re considered elite, like upper class rich. I wonder what the really rich people in China make, you know, the ones who copy all of Bill Gates software products.

david cheong May 22, 2008 at 12:30 pm

If there is difference between pro and unskill worker, they shouldn’t have their salary so big difference. Its like way more than 55% difference. Thats really unfair to them.

craig May 22, 2008 at 12:45 pm

Thanks for all the info John, its getting me even more excited about my trip to Shanghai this September: I cannot wait!

Best Host Online May 22, 2008 at 2:22 pm

Its good to be western educated as 17500 RMB is more than thrice than Average Chinese English speaking worker. But I think there may be many Chinese people who passed out from top Chinese universities who r getting the same wage as western educated. If not its getting very partial.

Turn Clicks Into Customers May 22, 2008 at 2:26 pm

That’s low indeed lol. Chinese are also known on the internet as cheap workers. They almost do it for free :)

Hoto May 22, 2008 at 2:49 pm

maybe in china women are easier to control, but these guys should not try this in germany. lol

Graham Langdon May 22, 2008 at 2:51 pm

fascinating reading, I like these types of articles John!

Mike Huang May 22, 2008 at 2:56 pm

Hmmm…17,500RMB a month is really a lot if I were to live in China. Makes me think if my wife and I should move there :P

-Mike

Stak Loaded - How to make money doing nothing! May 26, 2008 at 12:39 am

Isn’t that like $3000 lol?

Make Money Talks May 22, 2008 at 3:13 pm

I am going to China tomorrow :)

The Berry Tree May 22, 2008 at 4:13 pm

Good luck, let me know how it goes

Thomas De Maesschalck May 22, 2008 at 3:51 pm

What about real estate prices? How much does a nice big home in a good neighbourhood cost in China?

Zak Show May 22, 2008 at 4:19 pm

yes maybe you consider 2500$/month not enough but the level of living is not too high. John you have to visit Egypt to see that the engineer salary is not more than 150$/month and the teacher get a damn 100$ per month but they survive.

Jay May 22, 2008 at 4:24 pm

Great analysis John. It’s really shows the sad state of affairs in the US if we can’t retain grads after school. Very educational post.

Noobpreneur May 22, 2008 at 5:18 pm

John,

Visit Indonesia and it will open up a new horizon :p – Like what Zak Show mentioned about the salary in Egypt – that also a case in Indonesia.

Positive cashflow – hey, hey, nobody dislike it :)

john May 22, 2008 at 5:40 pm

As far as I know, it’s getting more and more difficult for the western educated students to find a job paying 17,500 RMB a month back in China. Quite a few of them have to settle down between 5000 – 10,000 RMB a month, still better than factory workers though.

Wade May 22, 2008 at 8:44 pm

I would hate the internet and rules there though. You basically can’t do anything.. No porn??? What gives?

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Sha May 22, 2008 at 9:25 pm

Informative post. You talked about some things I didn’t know about. That’s a damn shame about the poverty though.

Eric Go May 23, 2008 at 6:46 am

And I think it is important to note that for english speakers, I think ou can only get that good amount provided if you had passed some english certification exams such as esl, nclex, etc.

DeboHobo May 23, 2008 at 8:26 am

Hmmm I am looking to become an Expat maybe China is the place for me and my money.

Pradeep May 24, 2008 at 9:08 am

One thing i like most about chines people is that they are very efficient about their and i know few guys in my town who have offices in china they all ways talk about their employees the way they do their job and how efficient and dedicated they are about their job

MR. NICE GUY May 25, 2008 at 2:01 am

Sounds there are now many opportunities for factory workers in China. However many chinese workers still made fortune in other countries. Chinese are also lucky businessmen – just like John :twisted: :twisted: :twisted: :twisted:

AJ May 25, 2008 at 9:02 pm

I’ve seen pictures and videos of China, and an western educated person living in China is like heaven on earth. The costs of living is low with a great job plus the scenery in China is beautiful.

Bob May 26, 2008 at 1:36 am

China has a rich history & powerful future , no matter the people here are having low standard of living, but remember it’s fastest developing economy in the world!! ….