China has cut the maximum allowed margin of wage rises in state-owned companies for this year to keep pay growth, especially in monopolistic sectors.

State enterprises which paid employees twice as much as the average level of local urban wages in 2005 can increase total pay not more than 0.6 percent for each percentage of profit growth this year, according to a circular on the Website of the Ministry of Labor and Social Security late on Wednesday. The original cap was 0.75 percent.

The ministry said the government will stringently inspect the linkage between corporate profits and wage payments in state-owned companies where wages are too high and increasing too fast.

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