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Wage Growth Slows to 3.5% in June

MTI-Hungary Today 2021.08.31.

Year-on-year wage growth in Hungary slowed to 3.5 percent in June from 8.2 percent in the previous month, falling under the rate of inflation, the Central Statistical Office (KSH) said on Tuesday.

The data for businesses and institutions with at least five people on payroll show the average gross monthly wage for full-time employees stood at 436,300 forints (EUR 1,300). The average net wage was 290,200 forints (EUR 831).

The gross median wage was 350,000 forints (EUR 1,001).

Calculating with a 5.3 percent CPI, real wages declined by 1.7 percent in June.

Excluding the 85,800 Hungarians working full time in fostered work programmes — who earned on average a gross 84,500 forints in June — the average gross monthly wage in Hungary was 447,300 forints.

The average gross wage in the business sector, which includes state-owned companies, rose by 6.3 percent to 446,400 forints, excluding fostered workers. The average gross wage in the public sector, excluding fostered workers, fell by 4.2 percent to 456,800 forints, showing the impact of the healthcare workers’ bonus in the base period.

People working in the ICT sector were the highest earners in June, getting gross monthly 720,900 forints on average. People working in commercial accommodations and catering earned the least, 264,300 forints.

A broader set of data covering all full-time employees, not only the ones at employers with a payroll of five or more, show the average gross wage stood at 423,600 forints and the average net wage at 281,700 forints in June. The median gross wage was 335,800 forints.

Excluding fostered workers, full-timers earned a gross monthly 433,500 forints and net 288,300 forints.

Data for January-June show men earned, on average, 19.4 percent more than women during the period.

Analysts expect higher wage growth in rest of 2021 

Takarékbank chief analyst András Horváth noted that wage growth cleared of the effects of bonuses and one-offs reached 7.7 percent in June, practically level with the 7.8 percent of the previous month. Wages are continuing to climb as employers try to keep their staff and attract new workers, he added.

Takarékbank puts full-year wage growth at 9 percent.

K+H Bank senior analyst Dávid Németh said higher employment and an apparent labour squeeze in some sectors of the economy augur continued wage growth in the future.

Featured photo illustration by Csaba Krizsán/MTI