Photo shows a family returning home by motorcycle on the Wuzhou section of 321 national highway in south China's Guangxi Zhuang Autonomous Region. (Xinhua/Huang Xiaobang)

China's once inexhaustible pool of surplus rural labor is shrinking, with an increase of only one percent by June, and this has led to the increase of wages for blue-collar workers, according to data released by the Ministry of Human Resources and Social Security.

Among 500 villages in ten provinces that were part of a study done by the Ministry of Human Resources and Social Security, the number of new rural workers entering the labor force in the first half year was just 294,000.

The rural labor force has been a gradual decline over the past five years. In 2014 the figure had more than halved to just over 5 million when compared to the figures in 2010, which stood at 12 million.

With the shrinking of rural labor force, the average monthly wages of migrant workers has increased rapidly. In 2014, the monthly average salary of a migrant worker stood at 2864 yuan ($461), with a 9.8 percent growth compared to just 2609 yuan ($420) in 2013.

Zhang Chewei, the deputy director of the Institute of Population and Labor Economics at the Chinese Academy of Social Sciences says the increased wage is largely related to a change in China's population structure. China now has a rapidly aging population, with not enough young hands to replace the number of people who are retiring.

Zhang also says the higher labor cost will push companies to change from labor-intensive manufacturing to capital intensive manufacturing that uses high-end automated technology.