Income Gap decreasing for China

Chinese incomes rose faster in the countryside than in cities for a third straight year in 2012 as migrant workers boosted their pay and the government strengthened the social safety net.

Rural per-capita net income advanced 10.7 percent, compared with 9.6 percent for urban dwellers, partly on the rise in migrant laborers and their wages, the National Bureau of Statistics said Jan. 18. Rural residents’ income from benefits payments rose 21.9 percent, almost double the urban pace, as the government boosted its budget for health-care handouts.

Rural spending power has been lifted by wages earned by peasants working in cities, underscoring the broader benefits of the urbanization drive championed by incoming Premier Li Keqiang. Spreading gains in consumption would help sustain a growth rebound and reduce the economy’s reliance on exports, which rose last year at less than half 2011’s pace.

The trend may persist for a while as a declining working- age population helps push up migrant laborers’ pay and the government keeps improving social safety-net funds including for health care in the countryside, said Zhang, who previously worked for the International Monetary Fund.


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