Gross wages rise 5.8pc in January – UPDATE

Budapest, March 18 (MTI) – The average gross wage in Hungary rose by 5.8 percent in January from the same month a year earlier, after growing by 5.7 percent in December, the Central Statistical Office (KSH) said on Friday.

January’s gross wage came to 249,395 forints, the KSH said.

The average net wage rose faster than gross wages, at 7.4 percent, due to a one percentage point cut in the personal income tax rate 165,849 forints in January.

Excluding the 197,000 Hungarians in fostered work programmes, the average gross wage rose by 6.3 percent to 262,948, while net wages increased 8 by percent to 174,861.

Full-time fostered workers earned a gross 79,261 forints on average during the month, 1 percent less than in the same period a year earlier.

Including fostered workers, about 2,947,200 people were employed in Hungary in January, 3.4 percent more than a year earlier. Excluding fostered workers, the number rose by 2.9 percent.

Analysts told MTI that net wages were likely to grow in excess of 5 percent in the full year 2016, and economic growth would be driven by household consumption in the coming years.

Gergely Suppán of Takarékbank projected full-year gross wage growth of 4.3-4.5 percent for this year, which could translate into net wage growth of 5.8-6 percent due to the tax changes. He put real wage growth at 4.6-4.8 percent, assuming average annual inflation of 1.1 percent.