Hungary's gross wages are now rising by only 7.1%

The average gross earnings in Hungary stood at 754,700 forints in June, equivalent to about 2,073 euros. That is 7.1% more than a year earlier. The Hungarian Central Statistical Office (KSH) released the figures on Thursday. Gross wages last grew at such a slow pace in 2020 and 2021, excluding the one-time special payment to uniformed personnel, which skews the year-over-year comparison.

After taxes, full-time employees took home 529,700 forints, or about 1,455 euros. Net earnings rose by 9.4%, growing noticeably faster than gross earnings. This is due to tax policy: Budapest has expanded the family tax credit and exempted mothers from income tax.

Real wages rise by 7.6%

Consumer prices in June were 1.7% higher than a year earlier. Based on this, the KSH calculates a 7.6% increase in real wages. This figure is also lower than in May. Purchasing power is thus continuing to grow, but at a slower pace.

Median gross earnings reached 617,900 forints, while median net earnings stood at 438,000 forints. They rose by 8.8% and 10.9%, respectively. The median is growing faster than the average. This reflects the increase in minimum wage thresholds in January: the minimum wage rose by 11%, and the guaranteed wage for skilled labor by 7%.

The government now pays more than companies

Regular gross earnings, excluding bonuses and special payments, amounted to 708,600 forints, an increase of 7.9%. Companies paid an average of 700,800 forint, the public sector 717,600 forint, and the nonprofit sector 757,600 forint. The increases were 7.5%, 9.0%, and 8.3%, respectively. The gap between the public and private sectors has thus reversed.

Péter Virovácz, an economist at ING in Budapest, attributes this trend to a tight labor market. Some companies are retaining staff even though capacity utilization fluctuates. “At the same time, demographic trends are already putting structural pressure on the supply side of the labor market in the short term, which is leading to higher wages,” Virovácz said on Thursday. For the full year 2026, he expects a wage increase of 9 to 10%. The income tax reform planned for 2027 is likely to put the brakes on the minimum wage thereafter.

German investors with manufacturing operations in Hungary continue to pay rising wages, even though price pressure has eased. Those calculating location costs anticipate a nominal wage increase of 9 to 10% for 2026 and inflation of less than 2%. Unit labor costs are thus rising faster than in most neighboring countries. For German consumer goods manufacturers and retail chains, the picture is shifting: a real wage increase of 7.6% is supporting Hungarian demand, and the median income is rising at the upper end of the lowest income third. Those who view Hungary as a sales market stand to benefit. Those who manufacture there will lose their cost advantage.

Sources: Central Statistical Office, Gyorstájékoztató Keresetek June 2026 (HU); Hungarian National Bank, exchange rate as of August 27, 2026 (HU); ING Bank Hungary via Telex and Portfolio (HU).

SK, Frankfurt