Source 丨 Shenlan Finance

In December, three industry titans—CATL, ByteDance, and BYD—simultaneously announced salary increases. Why are these major players moving in such perfect unison?

Some analysts posit that the synchronized salary hikes among these major firms are linked to directives from 'higher authorities.' Here, 'higher authorities' unmistakably denote the decision-making echelons. The Central Economic Work Conference, convened earlier this month, underscored the priority of 'fostering domestic demand-driven growth and fortifying a robust domestic market' in its blueprint for next year's economic agenda. It explicitly emphasized the necessity to 'devise and execute strategies to augment the incomes of both urban and rural residents.'

These two guiding statements for the future unequivocally signal the nation's commitment to fostering income growth through diverse channels. This includes boosting the earnings of low- and middle-income groups and elevating the share of labor compensation in primary distribution. It is evident that a comprehensive, systematic income enhancement reform has been set in motion.

The rationale behind this initiative is not hard to fathom. Amid escalating external trade barriers and export volatility, coupled with the imperative to recalibrate internal traditional growth engines, China's economy is more reliant than ever on domestic demand as a linchpin. However, the prerequisite for this strategy is, undoubtedly, to bolster people's financial well-being.

For these industry giants, higher employee incomes will translate into sustained enhancements in employment stability and overall confidence. Consequently, talent will naturally be inclined to stay.

Consider the fiercely competitive AI sector as a case in point. Since June 2025, AI job postings have skyrocketed by 543%. To attract and retain top talent, ByteDance has unequivocally declared that its salaries will 'set a global benchmark.'

However, the question looms: Where will the funds for these salary increases originate?

Take BYD as an illustration. This year has posed significant challenges domestically.

In an environment characterized by 'anti-intense competition,' sales are under pressure, and profit margins per vehicle remain modest.

The confidence for salary increases may seem lacking, but unknown to many, BYD is reaping substantial profits overseas!

In the first 11 months of 2025, BYD sold nearly 910,000 vehicles overseas. The profit from selling one vehicle overseas can rival that of selling three to four domestically.

This clearly indicates that BYD is leveraging its high overseas profits to subsidize domestic talent investments.

This precisely unveils the true essence of 'anti-intense competition':

Not competing on the basis of low prices, but rather on technology, brand, and globalization capabilities.

However, BYD and similar companies are the exceptions.

So, how exactly can incomes rise? There are four avenues:

The first is wage-based income. This remains the cornerstone, and the nation has already taken action, with over 20 provinces raising minimum wage standards this year.

The second is operational income. The nation is supporting over 100 million individual entrepreneurs and small and micro-enterprise owners through measures such as tax and fee reductions, special loans, and optimizing the business environment. This enables them to generate profits, thereby allowing their employees to receive wages.

The third is transfer-based income. National finances alleviate people's concerns through pensions, medical insurance, and childcare subsidies.

The fourth is property-based income. Stabilizing the real estate and stock markets and increasing dividends will enable wealth to appreciate safely. When financial management can cover part of the mortgage and dividends can afford a new phone, the sense of security brought by 'passive income' can further stimulate consumption.

Therefore, this round of salary increases extends far beyond mere talent competition among industry giants.

It represents a nationwide income system upgrade, driven by the state and responded to by enterprises.

It signifies a shift in development logic from 'investing in things' to 'investing in people.'

It denotes a transition in growth mindset from defensive contraction to proactive offense.

In the future, we need more companies to break free from the intense competition red sea, earn premiums through innovation and globalization, and then feed back into income growth. We also require more policies to underpin income increases, thereby genuinely stimulating domestic demand and forming a positive cycle.

Although this path is not without challenges, the direction is already clear.

Making hard work more rewarding and wealth more attainable.

A more multidimensional era of income growth for all is on the horizon.

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