August 8th 2025 – In one of the most generous municipal pro-natal measures to date, Shanghai's Human Resources & Social Security Bureau—together with the Municipal Finance Bureau, the Medical Insurance Bureau, the State Tax Service, and the All-China Women's Federation branch— announced a six-month, 50 % refund on employers' social-insurance contributions for every employee on statutory maternity leave. The refund applies to births occurring on or after 1 January 2025 and covers the full bundle of statutory premiums: pension, medical (which already folds in maternity insurance), unemployment, and work-related injury. Because the average monthly social-insurance bill for a Shanghai worker earning the 2024 city median of RMB 12,000 is roughly RMB 4,200, the subsidy returns about RMB 2,100 per month per new mother—effectively cutting the employer's cost of keeping the position open in half.

To qualify, companies must: 

a) grant the full 158-day maternity leave required by the amended Shanghai Population & Family Planning Regulation, 

b) continue to pay social insurance on the employee's behalf for the entire period, and  

c) file electronically within 12 months of the birth. Applications are matched against birth-registry and social-insurance databases; refunds arrive within 30 days. City officials estimate that 180,000 – 200,000 births a year will fall under the new rules, implying an annual fiscal outlay of RMB 2.3–2.5 billion—funds already earmarked in the 2025 social-insurance budget.

The cash rebate is only half the story. The same circular urges districts and state-owned parks to expand the "Childbirth-Friendly Positions" pilot launched in December 2024. Participating firms receive an additional RMB 10,000 one-time grant for every post they redesign for returning mothers: options include compressed four-day weeks, 8-to-3 school-hours schedules, full remote work until the child turns three, and performance targets that exclude nights or travel. Early adopters—among them Jiangqiao SOHO, Zhangjiang Hi-Tech Park, and Lujiazui Finance & Trade Zone—have already retooled 5,100 jobs. Preliminary surveys by Fudan's School of Public Affairs show pilot employees' resignation rate falling from 18 % to 7 % and fathers taking 25 % more paternity days, suggesting the measures ease overall household stress.

Deputy Mayor Hua Yuan told reporters the policy trio—subsidy, tax deduction, and friendly posts—addresses the two biggest reasons Shanghai's total fertility rate has stayed below 0.7 since 2022: "the fear that motherhood derails careers, and the fear that careers can't afford motherhood." By lowering the effective cost of holding a job open, the city hopes to nudge more private SMEs—who employ 62 % of Shanghai's 4.8 million female workers—to hire and retain women of childbearing age without resorting to covert discrimination.

Business groups have reacted cautiously positive. "For a 30-person tech start-up, the refund equals one extra engineer's salary," says Laura Ding, chair of the Shanghai Young Entrepreneurs Association. Women's NGOs want more: "We still need affordable day-care and after-school care to close the gap," notes Zhou Min, director of the non-profit She Reboots.

The bureau promises real-time dashboards so citizens can track which companies claim the subsidy and how many friendly posts are created. If uptake is high, officials say the refund window could be lengthened to 12 months and extended to adoptive or second-parent leave—part of Shanghai's broader target to lift the fertility rate to 1.0 by 2030 and to stem the slide in its working-age population, projected to shrink by 1.2 million this decade.

PHC Advisory is a company of  DP Group: an international professional services conglomerate of companies with approximately 100 experienced professionals worldwide. We offer comprehensive services in tax, accounting, and financial consulting, including financial supervision, financial audit, internal audit, internal control over financial reporting, and support for audited financial statements and annual audits, ensuring clients' financial transparency and compliance. 

Would you like to learn more about the business environment in China? Click the link and download our Practical Guides on Amazon! 

The content of this article is provided for informational purposes only, financial advice must be tailored to the specific circumstances on a case-by-case basis, and the contents of this article do not legally bind PHC Advisory with the reader in any way. 

• A Comprehensive Guide to Corporate Liquidation-NEWS-PHC ADVISORY

• Government Funds District-Specific Programs for SMEs in Shanghai-NEWS-PHC ADVISORY