Economy 25 February 2021, 9:25am

Hungary average gross earnings HUF 450,000 in December

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Full-time employees’ gross average earnings were HUF 449,400 in December 2020, 10.6% higher than a year earlier, the Central Statistical Office (KSH) said on Thursday. Year-end premiums and bonuses increased the December average earnings by HUF 66,100. In January-December 2020 average gross earnings amounted to HUF 403,600, average net earnings without tax benefits were HUF 268,400; both grew by 9.7% compared to the same period of the previous year.

Full-time employees’ average gross earnings at corporations employing at least 5 people, at budgetary institutions and significant non-profit organisations in respect of employment amounted to HUF 449,400 and excluding fostered workers were HUF 461,700. Average net earnings were HUF 298,900 excluding tax benefits and HUF 308,000 including them.

Both average gross earnings and average net earnings excluding tax benefits grew equally, by 10.6%. Average net earnings including tax benefits rose by 10.8% compared to the same period of the previous year. The increase in year-end premiums and bonuses explain a significant part of the changes in average earnings.

This means that wage dynamics grew compared to preceding months and was again above 10% in December.

Average gross regular earnings (gross earnings without premiums and one-month bonuses) were estimated at HUF 383,300, which is 10.3% higher than a year before.

In January-December 2020:

Full-time employees’ average gross earnings at corporations employing at least 5 people, budgetary institutions and significant non-profit organizations in respect of employment, amounted to HUF 403,600 and excluding fostered workers to HUF 414,500.
Average net earnings were HUF 268,400 excluding tax benefits, and HUF 277,200 including them.
Both average gross earnings and average net earnings without tax benefits rose by 9.7%, average net earnings including tax benefits increased by 10.0% compared to the same period of the previous year, in relation to a temporary decrease as well as elimination of social security payment obligations in certain economic branches.
Average gross earnings were the highest in the financial and insurance activities sections (HUF 709,300) and the lowest (HUF 250,900) in accommodation and food service activities.
Full-time employees’ average gross earnings amounted to HUF 439,900 for men and to HUF 370,000 for women, representing increases of 9.0% for men and 10.2% for women within one year.
Average gross regular earnings (gross earnings without premiums and one-month bonuses) were estimated at HUF 371,000, which is 9.3% higher than a year before.
Along with the 3.3% rise in consumer prices compared to the same period of the previous year, real earnings increased by 6.2%.

It is important to note that many people may rightfully feel they are not earning as much as the average. Earlier this week, the KSH revealed that average gross earnings were HUF 75,480 higher a month than the gross median wage, up from HUF 50,000 ten years ago. The statistics office has not published the 2020 median wage today, but it was probably closer to HUF 300,000 than to HUF 400,000.

As for this year’s outlook, wages are expected to grow much slower than last year as the minimum wage increased to a smaller degree than in 2020 (and only from February), while the negotiating position of employees is not very strong. Inflation is expected to be remain 3% this year, so the growth of rea wages will also be slower than last year.

Cover photo: Getty Images