Gross wages in Hungary averaged HUF646,800 (€1,620) and net wages came to HUF430,100 last year, both up 13.2% year on year, according to data from the KSH.

Bouncing back from a decline in 2023, real wages rose by 9.2% at the fastest pace in 30 years as average annual inflation dropped to 3.7%.

Wages were lifted by the rise of teacher salaries in 2024 and the 15% rise of the minimum wage (10% for skilled workers). Last November, the government agreed with unions and employer groups on a three-year minimum wage agreement, which targeted a lower rise than in previous years. The agreement allows the government to change conditions pending economic performance.

Median gross wages reached HUF520,000, which equates to a net HUF345,500.

The KSH compiles data from companies with more than five employees, excluding micro businesses. As a result, actual wage figures are likely lower than the official statistics.

Territorial inequalities were striking, with the gross average salary exceeding the national average in only a few counties, and in some less developed regions they were 30-40% below that. Gross monthly wages the highest at HUF783,000.

Earnings inequalities among income quintiles remained substantial, with the highest earners taking home five times more than the lowest-paid workers.

In December, gross wages averaged HUF727,700 and HUF483,900 after taxes, both up 11% y/y. The gross median wage increased by 13.1% to HUF560,900. The rapid rise in the purchasing power of wages slowed in December to 6.1% as inflation accelerated in the last months of the year from is low of 3% in September.

Analysts expect a real wages to slow to 4-5% in 2025 as inflation is expected to average around 4% and as tight labour market conditions ease.

The government has grounded its ambitious 3.4% economic growth forecast for 2025 largely on the anticipated recovery of consumer spending.

However, despite this optimistic outlook, households are cautious as inflation expectations remain elevated. Retail sales last year grew at a much slower pace than real wages in 2024 as households replenished depleted savings after the inflation shock of 2023.