Hungarian Minister Nagy claims: Wages in Hungary far outshine Romania’s

National Economy Minister Márton Nagy spoke at an event in Miskolc on Monday, part of the Joint Venture Association’s Country Ride series.

Hungary is in “a good position”

Nagy said the government’s new economic policy action plan, a “precondition” for boosting economic growth over 3pc next year, was based on economic neutrality.

On the domestic front, he pointed to a gradual increase in retail sales and augured a further improvement in consumption as real wages rose 9-10pc. He also noted a significant increase in domestic guest nights, climbing used car sales and an 8-9pc rise in new car registrations.

Weighing external factors, Nagy said the “real breakthrough” would come when Germany’s economy, which impacts Hungary’s exports as well as its FDI, “pulls itself together”.

In terms of energy, Hungary is in “a good position”, Nagy said, with dynamically growing solar capacity and an expansion of the Paks nuclear power plant in the pipeline.

He said the Demján Sándor Programme for scaling up SMEs would make HUF 1,410bn available to businesses.

Hungarian wages are better than Romanian wages

Márton Nagy gave an interview to Index. In response to their questions, the minister said that the Romanian average earnings statistics also include elements of earnings that do not appear in the Hungarian earnings statistics, such as travel allowances and cafeteria.

Therefore, to compare apples with apples, you should use the Hungarian statistics as a basis for the labour income and not the average earnings. In the first three quarters of 2024, the average gross labour income in Hungary was HUF 678 thousand, which is EUR 1723 converted, while in Romania, it was RON 8379, which is EUR 1648 converted, i.e., almost EUR 40 lower.

According to Márton Nagy, the Romanian economy is unsustainable in the long run, as public wages are pulling the national average, only increasing the twin deficits. As an example, he cited two sectors where Romanian net average wages significantly exceed those of Hungary: public administration and information communications.

According to Márton Nagy, gross income in Romania is taxed more than the average wage in Hungary, so the average net labour income in Hungary is almost EUR 120 higher than in Romania.

He underlined that in 2024, in Hungary, the tax base can be reduced by HUF 66,670 (EUR 166) for one child, HUF 133,300 (EUR 333) for two children, and HUF 220,000 (EUR 550) per child for three or more children, while in Romania the maximum tax base is EUR 25 for one child, EUR 47 for two children and EUR 67 for three children. Hungary has a much more family-support-based tax system, he said.

Márton Nagy said the Hungarian economy is also stronger because 844,000 people in Romania receive the minimum wage, 18.7 percent of the workforce. In contrast, in Hungary, 214,000 people earn a minimum wage (4.6 percent of the employed) and 324,000 earn a guaranteed minimum wage (6.9 percent of the employed). In relative terms, more people earn a minimum wage in Romania than in Hungary.

“According to the latest data, the effective Hungarian minimum wage is the 17th highest in the EU and among the highest in the region, ahead of the Czech Republic, Slovakia, Romania and Bulgaria. The Romanian labour income data are sample-derived estimates, while the domestic one is based on institutional data sources, so the domestic statistics are much more reliable,” he told Index.

From taxes and salaries to cost of living and family benefits, an insightful comparison between Romania and Hungary reveals slight contrasts in quality of life. While it is an ambitious commitment to demonstrate which of the two countries offers a better life, a video showcased some interesting points.

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