Economy 15 October 2025, 9:51am

This is the minimum wage hike Hungarian employees want to see next year

Portfolio

Trade unions are considering a minimum wage increase of 12% for 2026, but employers have not yet reached a consensus and the figures may still change in light of the preliminary GDP data for the first nine months, which is due to be released at the end of October. Representatives of employers and employees told state newswire MTI this after Tuesday's monitoring committee meeting of the Permanent Consultation Forum between the Competitive Sector and the Government (VKF).

Imre Palkovics, president of the National Federation of Workers' Councils, said that the VKF trade union – comprising the Workers' Councils, the LIGA Trade Unions and the Hungarian Trade Union Federation (MASZSZ) – had presented a unified proposal for an agreement. According to this proposal,

a 12% increase in the minimum wage and a 10% increase in the guaranteed wage minimum are considered feasible for next year.

When formulating the proposal, the trade unions argued that wages in Hungary are relatively low, and that increasing the minimum wage would help to raise average wages.

They also pointed out that, given the current state of the economy, domestic consumption is the only sector contributing to maintaining GDP levels. Therefore, maintaining this is in the fundamental interest of the entire Hungarian economy. However, according to the president of the Workers' Councils, the employers cited their economic difficulties, indicating that the three-year wage agreement concluded last November, which will see the gross monthly minimum wage increase by 9% in 2025, 13% in 2026 and 14% in 2027, is unsustainable. This is contrary to the position of the trade unions.

Imre Palkovics pointed out that the three-year wage agreement includes procedures for cases where the three most important data points — GDP, earnings and inflation — deviate from what is specified in the agreement. As this is currently the case, the union leader believes there is a possibility the 2026 increase could be reduced by around 1.5%, resulting in a 11.5% minimum wage increase. However, he warned that there is no such automatic mechanism for the guaranteed wage minimum, which must be agreed upon separately each year.

Imre Palkovics indicated that, by proposing a minimum wage increase of 12%, the trade unions had also moved away from the three-year wage agreement, recognising that the 13% increase set out in it was not feasible.

László Perlusz, Secretary General of the National Association of Entrepreneurs and Employers (VOSZ), recalled that the three-year wage agreement stipulated that the minimum wage should reach 50% of the regular gross average wage by 2027, alongside dynamic economic growth.

However, this goal can only be achieved through dynamic economic growth, as a wage increase beyond this would be unfeasible.

However, he emphasised that there could be no talk of dynamic economic growth at present. Instead of the 3.4% GDP growth assumed in the agreement for 2025, only 0.5% is expected this year. He added that the economy had grown by only around 0.5% last year, meaning it has now been in a state of near stagnation for two years.

László Perlusz pointed out that the procedure established by the trade unions and set out in the agreement anticipates dynamic economic growth or correction, but this does not apply to the current situation as the Hungarian economy has deviated from its projected path. The VOSZ secretary general now believes that employers and employees should agree on a wage increase to ensure two important things: that the achievements in employment policy are maintained so that unemployment does not increase, and that inflation does not spiral out of control.

Employers are not unanimous in their wage increase proposals, so László Perlusz presented the position of the VOSZ.

The association believes that last year's results will be repeated in 2025, and is therefore considering a minimum wage increase of 9% for 2026. He added that they would be able to make a more favourable offer if labour costs (e.g. social contribution tax) were reduced.

Zs. Zoltán Szőke, President of Áfeosz-Coop, said that they believe the minimum wage could increase by 10% and the guaranteed wage minimum by 7% next year. Ferenc Rolek, Vice President of the National Association of Employers and Industrialists (MGYOSZ), emphasised that the three-year wage agreement was based on economic recovery and the expectation that GDP growth would exceed three percent this year. Unfortunately, this is not the case, with economic growth barely registering over the past two and a half years. In this situation, he said, the agreement needs to be renegotiated and a more realistic timeframe set for achieving the minimum wage target.

Taking expected inflation into account, it is possible for the minimum wage to increase by a single digit by 2026. A 10% increase in the minimum wage is possible if the government can reduce the social contribution tax (szocho). However, he noted that next year's wage increases will have to be much lower than that, as businesses have exhausted their options.

Despite the differing positions, László Perlusz assessed Tuesday's negotiations positively, believing that the differences are not insurmountable. He hopes that an agreement can be reached in early November.

Péter Lakatos, President of MGYOSZ, spoke to Portfolio in detail before the VKF meeting, saying that a delicate balance would be needed to reach an agreement.