Research On The Influence Of Minimum Wage Standard On Manufacturing Employment In China

Employment is the biggest livelihood! Under the global economic recession caused by trade friction between China and the United States and the epidemic,the employment situation in China has become more and more severe.The state has launched a series of policies to support employment stability.Among the 23 industrial categories of national economic industry classification,manufacturing is the most employment category to absorb labor force.People’s Daily points out : Although service industry has become the new engine of employment growth in China,service industry does not have the ability to absorb a large number of middle and low-end labor force transfer from manufacturing industry.Therefore,the key to stable employment is to maintain the employment stability of manufacturing industry.The minimum wage standard is a means of administrative intervention by the government through legislative procedures in the labor market.Its purpose is to balance the bargaining power of wages in labor force market between the supply and demand,so that low-income workers can share the economic growth dividend and achieve the effect of income distribution.Some scholars think that although the minimum wage standard in China is increasing year by year,the proportion of minimum wage standard relative to average wage is obviously lower,which weakens its impact on employment.However,some scholars analyze the influence of minimum wage standard on the labor wage level.They find that the minimum wage standard may affect the vertical allocation of labor resources among enterprises through “truncation effect”,“spillover effect” and “lighthouse effect”.Therefore,the minimum wage standard not only affects low-income people,but also the labor cost of enterprises or industries as a whole.On the one hand,the rising wage level will encourage the workers to choose employment;on the other hand,the rising wage level will increase the labor cost of the enterprise and reduce the demand for labor.Therefore,in academia,scholars have not reached an agreement on the employment effect of minimum wage.In this context,this paper studies the relevant impact of minimum wage standard on the employment of manufacturing industry in China and tries to find a reasonable influence path.This will help the policy makers understand the specific impact of the minimum wage on manufacturing employment in the uncertain macroeconomic environment,so as to make a reasonable policy adjustment for the current stable employment goal.This paper aim to provide reference basis to ensure the employment stability of manufacturing industry,and consider the legitimate rights and interests of low-income groups.Starting from the two core of minimum wage standard and employment,this paper analyzes the related factors affecting the employment of manufacturing industry,minimum wage standard and labor wage,minimum wage standard and employment,which lays solid theoretical foundation,and explores the marginal contribution and possible innovation of this paper.Then,from the economic man hypothesis,income distribution theory and marginal labor productivity theory,this paper discusses the behavior of the two sides of the labor market,considering the improvement of the minimum wage standard and puts forward the research hypothesis.Through combing the status quo of employment and minimum wage standards in China’s manufacturing industry,it lays a foundation for empirical analysis.In the empirical part,the paper constructs an appropriate measurement model based on the marginal labor productivity theory,and uses the minimum wage standards of provinces from 2004 to 2019 and the panel data related to manufacturing employment in China to make regression estimation.The research finds that the minimum wage standard has a significant negative effect on the overall employment of manufacturing industry.Through the intermediary effect test,it is found that the minimum wage standard can affect the employment level of manufacturing industry by the influence of the average wage of manufacturing industry.The influence of medium effect is about 31%;secondly,the minimum wage standard has a significant negative impact on the onjob employment of manufacturing industry,and has a significant positive impact on other employment in manufacturing industry;from the perspective of different ownership manufacturing industries,the minimum wage standard has a significant negative impact on the manufacturing industry of state-owned units and the manufacturing industry of urban collective units,and has a significant positive impact on the employment of private and individual manufacturing industry in China;from the regional perspective,the minimum wage standard has a significant negative impact on the employment of manufacturing industry in the east and west of China,and the negative impact of the minimum wage standard on the manufacturing employment in the eastern region is similar to that of the latter.Compared with the western region,the minimum wage has no significant impact on the employment of manufacturing industry in the northeast and central regions.Based on the research results,this paper puts forward the following policy suggestions:(1)The government should establish a more optimized minimum wage standard adjustment system,which is related to the level of economic development and price level and reflects the change of labor productivity,so that the minimum wage standard will not have an impact on the total employment of manufacturing industry.(2)In view of the protection of the rights and interests of informal employees(other employment and private and individual employment),the government should urge enterprises to implement the labor contract law.(3)The government should guide the transformation and upgrading of labor-intensive manufacturing industry from the perspective of policy,and provide policy assistance for the employment and transfer of labor force in manufacturing industry.(4)From the perspective of improving the income level of low-income workers and reducing the income gap between different regions,it is crucial to optimize China’s labor security system.