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Wages in Hungary in real terms up by 7% year-on-year

Staff writer ▼ | April 23, 2016
Real wages rose significantly, by 6.9 percent in January-February 2016, according to the Hungarian Central Statistical Office (KSH).
Budapest street
Europe   According to the Hungarian Central Statistical Office:
Minister of State for Labour Market and Vocation Education Péter Cseresnyés said that these data showed an upward wage trend has been in place for more than 3 years in Hungary.

Within the private sector, he added, the number of employees at companies with at least five employees grew by 68 thousand year-on-year in the observed period and such increase on the primary labour market has been unprecedented since the turn of the millennium.

In the initial two months of the year, the minimum wage and the guaranteed minimum wage rose 6.7 percent and 6.8 percent, which factors have also significantly contributed to overall real wage growth, he pointed out. These were the highest wage hikes since 2002.

In the period January-February 2016, gross and net wages – excluding family tax allowances – averaged HUF 248 800 and HUF 165 500, respectively. Including family tax allowances, average net wage was estimated at HUF 172 600 by the KSH.

Excluding the effect of public work schemes, gross wages averaged HUF 263 900 in the private sector, HUF 260 600 at budgetary institutions and HUF 238 800 at non-profit organizations in the observed period.

Within the national economy - taking into account the effect of public work schemes - real wages rose by 6.9 percent, while excluding this factor they were up by 7.5 percent.

Wages in real terms – excluding the effect of public work schemes -- increased by 6.2 percent in the private sector, by 11 percent in the public sector and by 5.5 percent in the non-profit sector, year-on-year, in the period January-February 2016.

Thanks to private and public sector wage hikes, favourable inflation, tax cuts and rising minimum wages, real wages have been steadily higher in Hungary. Concurrently, consumption has also been on the rise, which signals steady improvement of the financial status of Hungarian families.