There are significant differences in average wages between the member states of the European Union (EU), according to a recent analysis. We show where Hungary stands.
Huge differences between the average wages of the EU countries
The European Union places great emphasis on improving the working conditions of its citizens and strengthening employee rights. However, Euronews writes that there are still very significant differences between the average wages of the member countries.
This is proven by the fact that, based on Statista’s data for 2022, while the average annual salary in Luxembourg was 72,529 euros, Belgium was 63,758 euros, and in Denmark it was 59,405 euros, it was 24,067 euros in Greece, 24,337 euros in Slovakia, and 26,376 euros in Hungary.
Referring to Eurostat data, they write that the average labor cost was 30.5 euros (roughly HUF 11,500) per hour in the EU last year. In the same year, the average annual salary of childless, single workers in the state community was 26,136 euros, while that of working couples with two children was 55,573 euros.
The gross average salary is close to 700,000, but how much will it be worth?
By the way, in the first half of 2023, under tight labor market conditions, the guaranteed minimum wage and the minimum wage in Hungary increased significantly, and the average salary also rose considerably. However, inflation was higher than all of these, so the real value of the average wage decreased.
However, the research of the Equilibrium Institute highlights that in the second half of the year, due to weak demand and despite the lower wage growth, due to disinflation processes, the real wage began to rise again. But in their analysis, they still calculate a real wage decrease of 1.6 percent by 2023.
In the next period, the institute predicts economic growth and, due to the tightness of the labor market, further, dynamic wage growth in our country. They believe that the average gross monthly salary may be HUF 666,000 in 2024 and may increase to HUF 717,000 in 2025. As a result, a real wage increase of 6.7 percent next year and 3.9 percent after that is expected in the competitive sector.
Inflation is close, but below 10 percent
In October 2023, consumer prices in Hungary exceeded a year earlier by an average of 9.9 percent. Within this, food prices rose by 10.4 percent, household energy became cheaper by 16.1 percent, services became more expensive by 13.2 percent, and durable consumer goods had to be paid 0.7 percent more.
Consumer prices decreased by an average of 0.1 percent compared to September.
In accordance with last week’s agreement, the members of the Competition Sector and the government’s Permanent Consultation Forum (except for the Hungarian Trade Union Federation) and the government officially signed the agreement on the increase of the minimum wage and the guaranteed minimum wage, as well as the wage increase recommendation, on Monday. Thanks to the agreement between employers and employees, the monthly gross amount of the minimum wage will rise to HUF 266,800, and the monthly gross amount of the guaranteed minimum wage will increase to HUF 326,000 from December 1st.