For one more month, young people eligible for the summer student work scheme can work for their earnings free from income tax. This season, more than 25,000 young people have so far worked in local governments, tourism and catering, or agriculture with a state contribution of more than HUF 2.7 billion (EUR 6.8 million), said Zsolt Kutnyánszky, Secretary of State for Industry and Labor Market of the Ministry of Technology and Industry (TIM), in a statement on Thursday.
The summer student work program is open to full-time students aged 16-25 who are not currently employed and do not have a business contract. Local authorities and businesses in the agriculture, tourism, and hospitality sectors can apply for support to employ them.
In most cases, municipalities are looking for administrative assistants to replace their permanent staff during the summer holidays. Municipalities will be fully reimbursed for up to six hours of employment per day for a maximum period of two months.
There is also a significant demand in the tourism and catering sector where students are expected to help out in hotels, restaurants, and ice-cream parlors during the peak tourist season.
So far, around 5,000 applications have been submitted for employment in this sector, which represents almost 20% of the total demand. The maximum number of hours of employment in companies is eight hours a day, and the scheme covers three quarters of the wages, according to the press release.
Regarding wages, student workers are in a much better financial situation than last year. In 2021, the minimum wage for an hour was 963 forints, of which 819 forints remained after the deduction of the personal income tax. However, the minimum wage has been increased since then and those under the age of 25 do not have to pay personal income tax. As a result, now the minimum wage is 1,150 forints (EUR 2.9) per hour and student workers get this entire amount in their pockets.
Students’ expectations are also somewhere around this amount. According to a survey of Meló-Diák, the largest school cooperative in Hungary, an average student worker expects 1,300-1,500 forints per hour. The highest wages are in Budapest, where the average wage for an hour of student work is 1,600 forints.
This means that in the Hungarian capital, student workers can earn up to 256,000 forints (EUR 650) in one month if they work eight hours per day and they do not have to pay the personal income tax.
Compared to the minimum wage, which stands at 200,000 forints (133,000 forints after the tax deduction), student workers definitely fare better if they decide to enter the working field.
Most applications were received in Borsod-Abaúj-Zemplén, Baranya and Szabolcs-Szatmár Bereg counties. The district offices are constantly placing students in jobs and providing wage subsidies to employers, the latest figures show.
Since the program was launched in 2013, the government has already supported 264,000 young people to the tune of nearly 27 billion forints (EUR 68 million). The initiative has been very popular again this year, so the Ministry of Technology and Industry has increased the original budget by one and a half times to nearly HUF 3 billion.
Featured photo: MTI/Balázs Attila