Wages in real terms were up again significantly, by 3.9 percent in the first half of the year, according to the flash report of the Hungarian Central Statistical Office (KSH), published earlier this morning. Thus, wages in real terms have been on the rise for two-and-a-half years in Hungary. In comparison to June 2014, private sector enterprises with at least five employees increased their labour force by 45 thousand people.

Within the national economy, gross and net wage (excluding family tax allowances) was HUF 243 200 and HUF 159 300, respectively, which signal real wage growth of 3.5 percent year-on-year, thanks to an unchanged tax system.

In case family tax allowances are also taken into account, the KSH estimates that net wages averaged HUF 166 100. Excluding the effect of public work schemes, gross wages averaged HUF 261 300 at enterprises, HUF 242 600 at budgetary institutions and HUF 232 400 at non-profit organizations in the first half of the year.

As a result of the 0.4 percent average drop of consumer prices, wage growth in real terms was above the net wage increase in the initial six months of the year. Accordingly, wages in real terms were higher by 3.9 percent, while excluding the effect of public work schemes they increased 3.8 percent. In the period January-June 2015, wages in real terms grew by 4 percent within the private sector, 3.3 percent within the public sector and by 2.6 percent within the non-profit sector. Concurrently, the real wage of public work employees was also higher by 3.2 percent.

Thanks to favourable inflationary environment, increasing minimum wages and wage hikes in the private and public sectors, wages in real terms have risen in a steady manner in Hungary and that significantly improves the financial status of Hungarian families.

For detailed KSH data click here.

(Ministry for National Economy)