Wage Gap Narrowing In Hungary

  • 9 Oct 2018 7:48 AM
  • Hungary Matters
Wage Gap Narrowing In Hungary
The wage gap has been narrowing thanks to the faster increase in low wages, daily Magyar Idők said, citing labour market expert Piroska Szalai.

Gross median earnings have been growing faster than average earnings, Szalai, who is also head of the Budapest Business Development Public Foundation board, told the paper.

Gross median income, the amount that divides the income distribution into two equal groups, was estimated at 255,719 forints (EUR 790) a month in 2018, Szalai said. The median was 67% higher than in 2010 while the average wage grew by 60%, she added.

Among the reasons for the closing wage gap she highlighted the dynamic growth in the minimum wage and the beneficial effects of a six-year wage agreement.

Between 2010 and 2018, the minimum wage increased by 88% and the minimum wage of skilled workers by 102%.

This was above the increase in average earnings as well as median earnings, she said. In line with OECD figures, after the significant increase in the minimum wage in 2012, the top 10% of earners received 3.7 times more than the bottom 10%, whereas earlier the difference was 4.1-4.6 times.

The 2017 OECD figures are not yet available but the wage gap most probably dropped further, Szalai said.

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