Blue- and White-collar Employees Harder to Find

In manufacturing, blue-collar staff are increasingly hard to find in Hungary.

Although the fundamentals of the tight labor market are a hot topic across the region, that is not always the case across the whole of Europe.  

“The Mediterranean region rather suffers from a labor surplus, while the DACH [Germany, Austria and Switzerland] region and CEE have difficulties in finding sufficient workforce,” Tamara Tóth, branch manager of Cpl Jobs Hungary, tells the Budapest Business Journal.

Employers trying to recruit the best talent face several challenges, which can range for the lack of skills to the lack of actual manpower.  

“The biggest challenges for employers continues to be the hiring and retaining of employees, particularly white-collar positions within the engineering and IT fields,” says György Bucsku, team manager at Hays.

“Finding the right talent in engineering and IT has been a problem for more than a decade. In the meantime, the labor market has become even more international and companies are competing on a cross-border level for professionals,” adds Tóth of Cpl.

However, it is not only the IT sector that sees a labor shortage; there are issues around some blue-collar positions too.  

“The biggest shortage of candidates is in the manufacturing industry where the number of open positions has increased by 27%, making up 30% of the total vacant positions in Hungary,” says Bucsku of Hays.

Tóth of Cpl agrees that probably the most-recently affected sector in terms of labor shortage is manufacturing.  

Manufacturing Shortfall

“When it comes to blue-collar workforce, the labor shortage is clearly visible and even hinders growth and potential investments. Due to the lack of available workforce, companies have started to attract workers from each other by bidding above each other since money is the most important motivational factor among this population,” Tóth says.

Tóth adds that this situation on the one hand leads to the significant increase in salaries, while on the other hand it tends to promote a decrease in the length of average employment.  

“The employees are less trained and experienced, causing further operational risks for manufacturing and logistics activities, making production slower and increasing the risk of accidents,” says Tóth.

Following the trends of the previous years, Hungary’s employment rate has been seeing a year-on-year increase of 1-1.5%.  

“According to available statistics, the average gross salary in Hungary increased by 10-12% throughout the year. It was also observed that in some white-collar positions the salary increase reached 15%,” says Bucsku.  

“Due to accelerating competition amongst employers for the best candidates, many companies have had to increase salaries throughout the year in order to retain workers and expand the success of their recruitment. However, rapidly growing wage costs are often compensated for by reduced costs from automation,” he adds.