Hungarian gross wages grew by an annual 9.1 percent in September, up from 8.9 percent in the previous month, the Central Statistical Office (KSH) said on Tuesday.
The gross monthly wage for full-time employees averaged 428,100 forints (EUR 1,165), according to data on businesses and institutions with at least five people on the payroll. The average net wage was 284,700 forints (EUR 777).
The gross median wage was 349,300 forints.
With annual inflation of 5.5 percent in September, real wages increased by 3.4 percent.
Analysts: labour shortages could increase labour costs even more than expected
Wage inflation will remain high with next year’s increases and benefits, analysts told MTI, warning of broader associated inflation risks.
András Horváth of Takarékbank noted that employers were still having to raise wages to retain and attract labour. He added that often wages may rise by as much as 20-25 percent in a single year. The average wage rise may be in the double digits next year, he said.
Péter Virovácz of ING Bank said the structure of wage growth had become slightly more balanced with regard to the public and business sectors. Wage hikes were higher in the public sector, but the business sector also saw greater upward pressure compared with August, he said.
Virovácz noted increases in the minimum wages approaching 20 percent coupled with tax relief. At the same time, businesses face big cost increases in areas such as energy, transport and procurement. Also, labour shortages could increase labour costs even more than expected. The ING analyst pointed to a serious risk that large price increases may occur at the start of the year both in terms of products and services.
Gábor Regős of the pro-Fidesz Századvég Institute said earnings edged up modestly in September compared with previous months, while growth in real earnings was throttled by rising inflation. He said no big changes in wages were likely in the rest of the year, but one thing to look out for was the size of year-end bonuses and next year’s wage increases, driven minimum wage hikes and increased shortage of labour. Average wage rises may be in the double digits next year, he added.
Featured photo illustration by Tamás Sóki/MTI