Academic journal article Canadian Social Science

The Status and Strategies of Income Distribution regarding Frontline Employees: Liaoning Province, China Serves as an Example

Academic journal article Canadian Social Science

The Status and Strategies of Income Distribution regarding Frontline Employees: Liaoning Province, China Serves as an Example

Article excerpt

Abstract

The incomes of frontline employees are critical low and huge gaps of Income Distribution were found among companies and enterprises in Liaoning province. The main factors of this phenomenal are the absence of legal grounds, time lag of regulatory mechanism and incompetent state superintendence. In addition, the absence of collective consultation on salaries systems deprives employees' right of discourse. Thus, more supervision and administration on income distribution, regular income increase mechanism, administrative guidelines of income and the establishment of collective consultation on salaries systems are expected from government to ensure the steady and equitable increase of frontline employees' incomes.

Key WO rd S I Frontline Employees; Income Distribution; Government Intervention

INTRODUCTION

Frontline employees constitute the majority of companies' and enterprises' staffs. The increases on theirs salaries are of importance to domestic consumption and the growth of economic. However, China is facing severer income inequality than in Euramerican developed countries. At last count, the World Bank put China's Gini coefficient at 0.47. In 2006, Liaoning province, Gini coefficient exceed the critical level-0.4. That is to say, excessive wealth was concentrated in minority and severe inequality of Income appeared, both of which sabotaged the harmony and stability of society and sustainable development of economic. Taking practical and effective measures to improve the income distribution conditions inside and between companies and enterprises are the critical ways to both reducing income gap, optimizing the distribution of income as well as the sustaining harmony and stability of the society, and are the of importance elements to the expansion of consumer demands, the upgrading of industrial structure and the transformation of economic developing mode. Therefore, the Chinese authority shall strengthen the regulation of the internal income distribution of companies and enterprises, and take the necessary administrative force to ensure the collective consultation on salaries systems are functioning.

1. THE CONDITIONS OF INCOME DISTRIBUTION REGARDING FRONTLINE EMPLOYEES

1.1 TheProportion of Frontline Employees' Income in GDP is Considerably Small

The shares of GDP regarding total amount of laborers' salaries in Liaoning province dropped from 12% in 2001 to 9.6% in 2010, which was 2.2% below the national average. Moreover the developed countries' percentages can be as high as 25% to 35%. The index shows the Frontline Employees' Incomes were not synchronized with the economic development in Liaoning province.

Frontline Employees who are the direct creator of wealth to the society were severely lower paid comparing to the government agencies and public institutions Employees, which indicates the inequality of primary distribution of national income in China.

1.2 The Incomes of Frontline Employees Are Below Average Standard

The raise of income in Liaoning province pulled up the average income standard, whitewashed the fact that the majority frontline employees are being under-paid, however, is undeniable. High paid management layer attributes the most to the raising of average income, instead of the raising salaries for the frontline employees and the supporting production employees both of who are paid below the average standard in certain companies and enterprises. In the survey we made shows that about 71.5% of employees are paid below average standard, and among those about 26.9% are paid less than half of the average standard. Frontline employees constitute the main low-income groups, esp. to those labor-dispatching employee rural-in-cities-workers who are underpaid and employed in private business. National minimum wage standard states that the overtime wage and certain types of allowances like middle shift, night shift, extreme hot and cold working conditions, under-ground working, toxic and harmful working conditions shall be paid separately from general salary as well as working benefits that are required by laws and regulations. …

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