The rise in activity has also led to an uptick in the unemployment rate to 4.3 percent.Continue reading
Employment in Hungary saw significant strengthening throughout 2023, marking a turnaround from previous declines in real incomes. This positive trajectory is expected to continue into 2024, fueled by a deceleration in inflation and projected increases in real incomes, which are poised to stimulate household consumption and drive overall economic growth, as reported by Oeconomus.
Amid these positive developments, data from the Central Statistical Office (KSH) reveals that the number of employed people aged 15-74 surged to 4,723,000 by December 2023, reflecting a notable uptick compared to the previous year. This increase corresponded with a rise in the employment rate of this age group to 64.7%, representing a 0.4 percentage point increase from December 2022.
The Hungarian labor market has made substantial strides towards full employment during 2022-2023.
Efforts to achieve this have been concentrated on activating groups traditionally on the margins of the labor market, such as young people and parents with small children.
Comparative data from Eurostat for the third quarter of 2023, places Hungary’s employment rate (64.8%) in the middle among EU Member States. Unemployment, however, experienced a slight uptick to 4.2% by December 2023, with an average of 203,000 individuals unemployed throughout the year.
In terms of earnings, the average gross earnings for full-time employees in Hungary reached HUF 621,200 (EUR 1,600) in November 2023, reflecting a substantial 14.1% year-on-year increase.
This surge in earnings translated into a corresponding rise in real wages, which began to manifest from September onwards, following a dynamic slowdown in domestic inflation that saw the indicator fall to 5.5% by December 2023.
In nominal terms, earnings experienced a remarkable surge of 15.5% in Hungary during the third quarter of 2023, outpacing increases in neighboring countries such as Croatia, Bulgaria, and Romania. This robust growth in earnings underscores the resilience and dynamism of Hungary’s labor market amid broader economic fluctuations.
Looking ahead, the positive trajectory of employment and earnings is expected to underpin further growth in household consumption, thereby contributing to overall economic expansion in 2024.
As real incomes continue to rise and inflation remains subdued, private household spending is anticipated to play a pivotal role in sustaining economic momentum.
In summary, Hungary’s labor market has exhibited notable resilience and adaptability in the face of economic challenges, with employment and earnings trends signaling a path towards sustained growth and prosperity in the coming years.
Via Oeconomus; Featured Image: Pixabay