Low wages, lack of skilled workers taking toll on economy

Employers in Hungary are having a harder time than the global average when it comes to tracking down skilled labor. According to a survey by ManpowerGroup, 57% of respondents face difficulties in this regard here as opposed to a worldwide average of 40%. Around one-third of local companies are completely out of luck in their search, and a similar proportion have problems with engaging qualified hands and brains. 

“We are witnessing a global phenomenon here, but Hungarian employers are in a particularly sensitive situation as they need to beat not only domestic competition for talent, but also firms in Western Europe and the neighboring countries,” László Dalányi, managing director of ManpowerGroup Hungary tells the Budapest Business Journal.

Businesses polled indicated different approaches to overcoming the HR bottleneck. Most (31% of respondents), intend to train existing employees, 16% wish to go down the route of more attractive allowances, and some 13% plan to offer bonuses on top of salaries.

“The biggest obstacle is evidently the low level of wages,” Dalányi explains. “However, Hungarian employers feel that their competitiveness could be jeopardized if they raised it by a large extent. Paradoxically, the acute lack of specialized manpower has reached a level that undermines competitiveness.” Dalányi believes, therefore, that it is high time to decide what has a more negative impact on a business: having more wage-related expenses, or not being able to get the job done at all.

“Substantial raises have become inevitable by now, not least because salaries are the lowest here in the European Union,” he points out. Implementing payment increases is further slowed down in many cases by the fact that subsidiaries need approval from their parent companies abroad.

The list of the top ten most wanted professionals is pretty much identical on both the local and the global level. Craftsmen, IT specialists, engineers and financial experts have the easiest time in finding work anywhere in this world, but especially in Japan, Taiwan and Romania, where the labor shortage is currently the highest on the planet.

Foreign practice shows that 53% of businesses address the issue by introducing training, which is a 20% jump compared to last year’s figures. “Hungary must catch up in this regard. In certain sectors such as automotive, they have realized the importance of it, but other industries still have a long way to go in order to stay in the game,” Dalányi says.