China's surging wages and other costs are showing signs of undermining the competitiveness of the nation's economy, threatening its growth potential, the Asian Development Bank said.

Average inflation-adjusted wages have more than tripled in a decade, and non-wage costs for procedures such as hiring and firing have risen since the introduction of a 2008 labor law, the ADB said in a report published on Tuesday.

The labor market is being squeezed across the nation as the pool of working-age people shrank last year.