China's average salary level is expected to increase by 8.6 percent in 2013, lower than 9.8 percent in 2012, according to figures from 51job.com. Recruitment company Career International estimates the country's average salary level will rise by 9.43 percent this year, the lowest level since 2010.
"Business owners are more concerned about a salary hike in 2013, as most of them have seen a worsening business performance, and feel uncertainty about whether the Chinese economy will get better this year," Feng said.
But entrepreneurs still have to be prepared for the rising labor costs in 2013, or they may face a labor shortage or a talent drain, Feng noted.
"China's inflation is expected to pick up this year, pushing up living costs and thus pressuring employers to raise salaries to retain employees," Feng said.
"But the growth in salary always fails to meet employees' expectations as living costs rise faster," she added.
Some private entrepreneurs are taking a wait-and-see attitude on how much to raise salaries.
"Our company's salary growth rate for 2013 will depend on the demand and supply in the labor market after this year's Spring Festival holidays," Lou Zhongping, chairman of Soton Daily Necessities Co, a manufacturer of drinking straws in Yiwu, East China's Zhejiang Province, told the Global Times Tuesday.
Last year, Lou raised salaries by 12 percent for the factory's over 500 workers, which amounted to more than 2 million yuan ($321,200) and equaled one-third of his annual profit.
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