The German Chamber of Commerce in China has published the 19th edition of its Labor Market & Salary Report, a comprehensive benchmark for wages of German and international companies in China. The report reveals that companies are taking a conservative approach to salary planning, placing greater emphasis on cost control in their HR strategies. This reflects continued price pressure as their primary business concern - even as the business outlook showed a slight improvement earlier this year. While AI adoption in practice is not prevalent yet, German companies in China primarily leverage AI as a trigger for workforce development rather than as a replacement for current employees.
Salary Indicators
- New record low in expected salary growth: Expected salary growth for 2027 declines to 2.95%, down 0.24 percentage points (p.p.) from the projection for 2026 (3.19%). For the first time ever, the expectation fell below 3%.
- Actual increases lag behind projections again: Effective salary increases fall short of projections for four consecutive years, though the gap narrows from roughly 0.6 p.p. in 2025 (3.24% vs. 3.81%) to 0.2 p.p. in 2026 (2.98% vs. 3.19%).
- Wage levels remain almost unchanged: The median Total Cost per Employee remains broadly stable in 2026 at CNY 20,000 per month, up slightly by CNY 295 from CNY 19,705 per month in 2025.
- Labor costs slightly decrease: In 2026, labor costs account for 28.8% of total expenses among German companies in China. This is around 2 p.p. lower compared with the previous year’s level of 30.9%.
HR Management
- Majority see no impact from AI adoption: 70% report no significant impact on their job structure so far from the introduction of artificial intelligence or automation technologies, 17% use it for upskilling and only 8% have reduced redundant positions.
- Share of foreign employees reaches all-time low: The share of German companies in China employing foreign staff continues to show a declining trend, falling from 65.1% in 2025 to 63.3% in 2026. Notably, a substantial gap of more than 30 p.p. persists between small-size companies (46.5%) and large-size companies (78.8%).
- Most functions work 40–42 hours weekly on average: Across all departments, the biggest share (57%) works 40-42 hours. Production reports the longest working hours, with 30% of companies indicating workweeks exceeding 48 hours.
Recruiting
- New external hires receive only slight salary adjustments: The majority (67%) of companies offered salary increases of 0–5% for external hires in 2025. For internal promotions in 2025, 44% of surveyed companies offered salary increases of no more than 5%, while 47% provided increases of around 5–15%.
- Fewer companies expect to reduce their workforce in 2026: In 2025, 21% of companies expected to reduce their workforce, while the actual share reached 28%. Looking ahead to the whole of 2026, the outlook is slightly more positive, with 17% of companies expecting workforce reductions.
- Still, Sales and R&D are the hardest roles to fill: Around one-third of companies find it difficult or very difficult to recruit qualified talent for Sales (33%) and R&D (31%), followed by Management (24%).
More HR Data
- Average tenure: 6.31 years white-collar employees, 6.8 years blue-collar employees
- Sick leave per year: 3.8 days white-collar employees, 3.4 days blue-collar employees
- Annual leave per year: 13.4 days white-collar employees, 11.8 days blue-collar employees
- Annual employee turnover rate: 7.2% white-collar employees, 6.1% blue-collar employees
About the Labor Market & Salary Report 2026/27
The 19th edition of the Labor Market & Salary Report is based on an online survey conducted between April 22 and June 6, 2026. Overall, it received responses from 571 member companies of the German Chamber of Commerce in China.
To download the full version of the report, please go to the Member Download Area in the Member Directory.