Wage growth for middle managers was only 1.5 percent in the first quarter
In the first quarter of this year, the average gross hourly wage of skilled and semi-skilled manual workers was 1,388 forints, according to an analysis by Trenkwalder of the wage data of nearly 7,000 people. This is 5 percent higher than the 1,326 forints recorded in the same period last year. The pace of wage growth was even more subdued in the top categories: Moore Hungary found that the pay of around 500 middle managers in more than 60 mostly internationally-owned domestic companies rose by just 1.5 percent compared to the first quarter of 2020, significantly below the 6.6 percent recorded a year earlier.
„The coronavirus epidemic has fundamentally changed the dynamics of hourly wage growth in the physical sector: while in 2019, at the peak of the labour shortage no less than Average annual increase in hourly wages was 21 percent, in 2020 it was only approaching ten per cent, and much of the increase occurred in the period before the epidemic - said Viktor Hamrák, Head of Trenkwalder Industrial Business Unit. - The current increase of 5 percent shows the changing labour market, in which labour supply has temporarily caught up with demand. In the following quarters could accelerate again wage growth: as the market normalises, it will gradually absorb the available supply, a process that will be reinforced by the possibility of working abroad, which will once again offer an attractive alternative for a wider range of people.”
Trenkwalder's data show that there was some convergence between wage levels by region at the beginning of this year, but the gap is still significant: while average wages in the Great Plain, Northern Hungary and South Transdanubia are below HUF 1,300, in Central Hungary they are still close to HUF 1,800.
At the same time, Moore Hungary examined the salary data of nearly 500 middle managers working at the domestic subsidiaries of more than 60 international companies. For employees working in the gross monthly salary range between HUF 700,000 and HUF 1 million, the average wage increase in the first quarter of 2021 was 1.5 percent compared to the same period last year.
„In the middle management segment, salaries rose by almost 7 percent year-on-year at this time last year, at the height of the epidemic, and since then average wage growth has virtually stopped. explains Péter Hajnal, Managing Partner of Moore Hungary. There have also been major cutbacks in a number of sectors, which has also held back the pace of wage increases. It is interesting to note that while in the first months of the epidemic, the service centres (SSCs) were much less exposed to the negative effects of the coronavirus, now in this round a major turnover wave since the beginning of the year in the Moore Hungary sample, the drop-out rate was close to 8 percent. They are not changing jobs primarily out of necessity, but for better jobs and pay, and this suggests that (at least in this sector) we can expect to see more substantial wage increases again soon.”
Moore Hungary
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