Abstract: With economy of China is stepping into the “new normal”, both economic growth and TFP have presented a downward tendency. However, the key to improving TFP is to reduce the unit labor cost (ULC).This paper measures ULC of non-agriculture sector in China and its change with the data between 1995 and 2014, and compares ULC in 7 representative provinces in the central and eastern regions. The result shows that the rate of wages of non-agriculture sector increases faster than that of labor productivity in the nationwide, and ULC steps into a long-term increase,which is due to the situation in the eastern region is more prominent, and its economic volume accounted for a large proportion, which greatly affected the results; ULC of non-agriculture sector in central regions is higher, but growth is relatively slow, and the labor productivity in Central China has risen faster than the level of wage growth, resulting in the relative decline of unit labor cost in Central China, and its competitiveness and quality of development have been continuously improved. Improving labor productivity is an effective way to alleviate the pressure of unit labor costs. In this respect, the eastern region has the basic advantages, and the central region has more potential.

Key words: ULC, labor productivity;reform of the supply front;advantages of backwardness;regional difference