Increasing labor costs have become a focus of concern for enterprises and government since China's entry into the WTO. Based on recent statistics and case studies of enterprises in Shanghai, changes in labor costs in Shanghai are examined in this paper and compared with other areas around Shanghai. Some factors contributing to recent increases in laborcosts in Shanghai are analyzed. It highlights that labor costs in Shanghai will continue to increase due to the city's rapid economic development and intensive use of human capital. It points out, however, that some room still exists to reduce the labor cost, and several practical measures are suggested.
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