In January 2017, gross wages were up by 10 percent year-on-year, rising to HUF 273 800, which means that families can already see the effect of the six-year wage agreement, Minister for National Economy Mihály Varga said. Even taken into account subdued inflation, wages in real terms rose outstandingly, by 7.5 percent. Thus wages in real terms have been rising uninterruptedly, since the beginning of 2013, for 49 consecutive months in Hungary, he stated.

The January wage growth stemming from the wage deal concluded with employer and employee organizations may further improve the economic activity rate and help keep the Hungarian labour force. The Government facilitated the increase of mandatory minimum wages through the reduction of payroll taxes, from 27 percent to 22 percent, he added. The amount of tax allowance to which families with two children are entitled has risen since 1 January 2017; therefore net wages in their case increased even more, the Minister noted.

According to the data released by the Hungarian Central Statistical Office (KSH) earlier today, the increase in the number of people employed in the private sector, 87 thousand, was unprecedented over the observed period, which signals dynamic job growth. The number of employees at enterprises with at least five employees has hit 2 million for the first time since 1999, when such data were first gathered. Besides the economic upswing, job growth has also been the result of Government measures, economic development programmes, tax cuts and the incentives of the Job Protection Action. Strong labour demand is being underpinned by the announced capacity increases at enterprises, low raw materials prices, the housing construction boom driven by Government incentives and the acceleration of the disbursement of EU funds, he pointed out.

(Ministry for National Economy)