Minimum wage increases in China between 2001-2007 led to a significant decrease in firm employment, with a stronger impact on low-wage firms compared to high-wage firms. The employment elasticity was estimated at -0.116, showing a negative effect on jobs. Before 2004, minimum wage hikes had little effect on employment. The study used a unique dataset and a dynamic panel estimator to analyze the impact of minimum wage policies on firm employment, finding that labor market competition may explain the varied effects on different types of firms.