China’s 15th Five-Year Plan covers 2026 to 2030 and sets out the country’s economic priorities for the coming decade. Adopted by the National People’s Congress in March, it has already been widely analysed. But for employers with teams on the ground in China, what it actually means in practice is not always clear.
Part of the reason is that the plan contains few concrete mandates. Only about a third of its 20 key indicators are binding. Economist Adam Tooze compares it to the U.N.’s Sustainable Development Goals: it sets priorities and targets, but leaves the details to others.
In China’s case, those others are the ministries, provinces and municipalities that each draft their own plans based on the national document. The specific changes that matter most to employers, like shifts to social insurance rates or leave entitlements, will follow over the months and years ahead as lower-level plans are published.
Yet, what the national plan does provide is a clear direction of travel. And from that, it is possible to make some confident predictions about what China’s regulatory environment will look like for HR and payroll over the next five years.
Here is what we expect.
Prediction 1: Wage Floors Will Rise
The plan identifies raising household consumption as a share of GDP as one of its core goals. Its most employer-relevant lever for doing so is raising incomes.
National Development and Reform Commission Secretary-General Yuan Da confirmed this at a press briefing, adding that the government would formulate an income growth plan for urban and rural residents. But what will that actually look like?
The most direct intervention will be raising the minimum wage. Minimum wages are set at the city and provincial level, and Beijing has encouraged local governments to raise them to support consumption and wage growth. Most regions revise their minimums at least once every two years, and around half did so last year, according to Caixin.
Further increases seem likely. And when minimums rise, they tend to pull up wages for lower-paid workers more broadly.
For higher earners, direct intervention is unlikely. But officials have said they will “reform remuneration systems and improve wage consultation mechanisms.” In plain terms, this means creating more formal processes for workers to negotiate pay.
In China, workplace negotiations like this go through official unions, which are all part of the state-backed All-China Federation of Trade Unions. These unions have not historically pushed hard on pay. But the government could ask them to play a bigger role, which could mean more formal annual pay talks between workers and employers, particularly at foreign companies.
Beyond policy, broader economic trends point the same way. As China moves up the value chain into higher-skilled industries, competition for talent is intensifying and wages are rising regardless of government action.
Prediction 2: Social Insurance Costs Will Increase
China’s ageing population is another major focus of the plan. And funding elderly care and pensions is driving big changes to the social insurance system — the mandatory payroll contributions that employers and employees pay into to cover health care, pensions and unemployment. For employers, this is likely to be the most immediate cost pressure.
Two big changes are coming. The first is a new type of contribution. Since 2016, China has been testing a long-term care scheme in 49 cities, covering care for elderly and disabled people. It now covers more than 300 million people, and the government plans to roll it out nationwide by 2028. Employers will likely have to pay into this on top of their existing contributions, at rates set locally.
The second is pensions. A senior NDRC official said the government plans to gradually raise basic pension payments for urban and rural residents during the five-year plan. No one has said how this will be funded, but higher payouts have to be paid for somehow. And higher employer and employee contributions are the most likely answer.
Both measures come amid a sharper enforcement push. In 2025, China’s top court ruled that any agreement between employers and workers to waive or reduce social insurance contributions is invalid.
Prediction 3: More Parental Leave
The plan includes a push to raise China’s birth rate, under the banner of building a “childbirth-friendly society.”
One lever for achieving this is to improve the maternity leave system. Maternity leave provision remains uneven across China despite recent expansions. So we expect more cities and provinces to raise entitlements during the plan period, accompanied by new local subsidy schemes. Shanghai, for example, already offers social insurance subsidies that can halve employer contributions during a female employee’s maternity leave.
Paternity leave is another area to watch. Most provinces offer fathers 15 to 30 days, but there is no national standard.
Beyond that, analysis of the plan points to the introduction of shared parental leave, a separate entitlement that either parent can take. Some provinces already offer this, and more are likely to follow. A senior CPPCC member echoed this during this year’s “two sessions”, calling for reforms that encourage couples to share child care more equally. Proposals like this at the “two sessions” often lead to provincial or national action.
Prediction 4: Flexible Leave Arrangements Will Become More Common
China has also begun testing whether longer holidays can boost consumer spending, a trend we expect to see expand over the next five years.
The 2026 Spring Festival, for instance, was extended to a record nine days, which Xinhua described as a move to boost domestic consumption and public well-being. The 2026 government work report also proposes spring and autumn breaks for primary and secondary school students, similar to half-terms in the U.K. Several regions are already piloting these, largely as a way to get families travelling around China.
But this only works if parents can actually take time off, and that tension is already being discussed at the highest levels.
“If students get time off, but their parents don’t, how can they travel together?” Zhao Wanping, an National People’s Congress deputy, told Xinhua.
To address this, some advisers have called for stronger legal protections to ensure that taking time off does not hurt performance reviews or career prospects. Others have proposed linking employer compliance with leave rules to tax incentives or corporate credit scores. Employers should expect tighter rules around annual leave over the next five years.
What We Expect Over the 15th Five-Year Plan
To summarise:
- Wages: Minimum wages will rise, pulling up pay more broadly. Keep salaries competitive.
- Social insurance: A new long-term care contribution is coming and pension costs will rise. Make sure you are fully compliant.
- Parental leave: Maternity, paternity and shared parental leave entitlements will all expand.
- Annual leave: Expect stronger rules ensuring employees can actually take their leave.
