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The Bureau of Labor Statistics publishes estimates of hourly compensation costs for production workers in manufacturing for 31 economies on its Web site.97 Although most of the countries are developed countries with high-quality data, some developing countries with adequate data also are included. The Bureau is working to add countries, including China, to the published list, but BLS standards for the quality of statistics are high. Data for China are not yet in accord with BLS comparability definitions. (See Box 1.) This report assesses the quality and completeness of those statistics which are available on manufacturing earnings and compensation in China.

The subsequent analysis is based as much as possible on information published by China’s official statistical organizations. Most statistics for China are collected under the central guidance of the National Bureau of Statistics (NBS) and often are published jointly with the Ministry of Labor and Social Security (hereinafter, Ministry of Labor). Collecting data on manufacturing employment in TVE’s, however, is the responsibility of the Ministry of Agriculture, and data on the earnings of noncity manufacturing employees were first published for the year 2002. 98

Focusing on 2002, the most recent year for which adequate data are available, the upcoming discussion tabulates information on earnings, required social benefit payments, and other labor compensation and derives annual, monthly, and estimated hourly manufacturing labor compensation, in Chinese yuan, for urban, TVE, and all-China manufacturing employees. These estimates are then calculated in U.S. dollars at the official exchange rate.

The annual data on labor compensation in manufacturing used in this report come from the annual yearend statistical reporting system. (China’s censuses do not ask for earnings data.) In China’s cities and, to a lesser extent, outside the cities, each enterprise, economic unit, small business, or self-employed individual or group is required to report employment and earnings data each year according to the group’s “labor situation” the previous year and at the previous yearend. The data are then compiled upward in a statistical reporting chain to the national government. Accountants or those who report employment and earnings figures on behalf of their enterprises or other work units (at least, those in urban areas) are given detailed instructions on how to report monthly, quarterly, yearend, and average annual figures on employment and earnings. The instructions are based on regulations released by the NBS, especially those released in 1990, with further clarifications in 1998 and 2002. 99

In reporting annual statistics on employment and earnings, China’s NBS and Ministry of Labor use an administrative reporting system that ignores the progress China has made in the statistical definitions of “urban” and “rural” during the last several decades. As mentioned in the foregoing section on manufacturing employment in China, in statistical publications on China’s labor force data, employment and earnings data labeled “urban” actually refer to cities and exclude employees working outside narrowly defined city boundaries. Even factories located in suburbs, large industrial parks, and towns that have been officially established as urban places since the 1980s are excluded from the so-called urban statistics on employment and earnings. In the tables and charts of this report, statistics are faithfully shown as they were reported in official publications. In the text, the word “city” often is used to describe the “urban” data, simply because


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