The Japanese automobile company's Hungarian subsidiary reached an agreement this week with employees.Continue reading
The economic situation is not easy around the world, but especially in Europe, and Hungary is feeling the effects. An article in Világgazdaság has now revealed that there could be huge differences in pay raises next year, with some companies giving workers a significant pay increase and others not giving any at all.
The situation for workers is also made more difficult by the lack of a trade union to protect and represent them, as individual advocacy is much less likely to succeed. However, negotiations on next year’s wage agreements are still ongoing, Melinda Mészáros, president of the LIGA Trade Unions, told Világgazdaság. The negotiations are also helped by the fact that the government announced an increase in the minimum wage and the guaranteed minimum wage. Because of the increase, employees are seeking a pay raise for themselves and are not afraid to ask for more money.
As Mészáros revealed,
most places can expect a 16-17 percent pay increase in 2023, but the figures could be misleading.
This increase does not necessarily mean an increase in basic wages, but often it is the sum of other additional benefits, such as bonuses, on top of earnings that gives this percentage.
Imre Palkovics, President of the National Federation of Workers’ Councils, said that in the automotive industry, where people mainly work on the assembly line, a 17 percent increase was generally agreed to. However, it is worth noting that this is a gross increase, and given that various allowances and bonuses are built into the basic salary, the increase is actually only around 10 percent.
As Hungary Today reported earlier, Mercedes-Benz announced shortly before the end of the year that employees in Hungary would receive a 27 per cent pay raise next year. Starting January 1, Mercedes-Benz Manufacturing Hungary Kft. will increase base wages by 17 percent and by another seven percent starting in August, according to several industry sources. Together with other elements, such as a quarterly special payment linked to inflation and a newly introduced profit-sharing scheme for employees, the total benefits package for employees could increase by more than 30 percent from current levels.
However, as inflation could average 15-16 percent a year next year, the pay increases do not mean that much, in fact.
In the end, the average Hungarian worker is likely to suffer a real wage decrease of around 3-4 percent next year due to the worsening economic situation and inflation.
Moreover, not everyone is in the fortunate position to get a pay raise at work. According to Mészáros, nearly 40 percent of Hungarian workers have not received a pay increase.
Hungary is not the only country in the region where real wages are expected to fall next year. Among the Visegrád Four countries, only Poland is in a better position on the wage front, with a two-step minimum wage increase of 20 percent to cover the 13 percent inflation there. The Hungarian government has also announced a minimum wage increase for next year, meaning that this year’s minimum wage of 200,000 forints gross will rise to 232,000 forints gross from 1 January 2023, while the current guaranteed minimum wage of 260,000 forints will rise to 296,400 forints gross next year.
Featured photo via Facebook/Audi Hungaria Győr