What effect does the increase in social security base have on wages?

The impact of the increase in social security base on wages is mainly reflected in the amount of social security contributions of individuals and enterprises and the actual income of individuals.

First, the increase in social security contributions.

After the social security base is raised, the social security contributions of individuals and enterprises will also increase accordingly. Individuals need to pay more social security fees, including pension insurance, medical insurance and unemployment insurance. However, enterprises need to pay higher social security fees for employees, which increases the labor cost of enterprises.

Second, the reduction of personal real income.

Due to the increase in the amount of social security contributions, the actual income of individuals will decrease accordingly. Although the total salary has not changed, the actual income after deducting social security expenses will decrease. For some low-income groups, this may cause some pressure on their lives.

Third, the improvement of social security benefits.

The upward adjustment of social security base also has its positive side. With the increase of social security contributions, personal social security benefits will also increase accordingly. For example, the level of old-age insurance may be improved, and individuals can enjoy higher pensions after retirement.

Fourth, the increase in the burden on enterprises.

For enterprises, the increase of social security base means that they need to pay higher social security fees. This increases the operating cost of the enterprise, which may cause certain pressure on the operation of the enterprise. Some small enterprises may face greater economic pressure.

To sum up:

The influence of the increase of social security base on wages is mainly reflected in the increase of social security contributions of individuals and enterprises and the decrease of personal actual income. Although the improvement of social security benefits is positive, both enterprises and individuals need to bear higher social security costs, which may have a certain impact on their economic situation.

Legal basis:

People's Republic of China (PRC) social insurance law

Article 12 stipulates:

The employing unit shall pay the basic old-age insurance premium according to the proportion of the total wages of its employees stipulated by the state, and record it in the basic old-age insurance pooling fund. Employees shall pay the basic old-age insurance premium in accordance with the proportion of wages stipulated by the state and record it in their personal accounts.

People's Republic of China (PRC) social insurance law

Article 35 provides that:

The employer shall pay the work-related injury insurance premium according to the total wages of its employees and the rate determined by the social insurance agency.