The Hungarian model is working – lowest unemployment since 1989
With record-low unemployment, steadily increasing wages and other rock-solid indicators, the Hungarian economy is healthier than it’s been in years. The economic performance of Central Europe has become the driving force for growth in the EU, but that’s not the only reason why Hungarians can now be proud of their achievements over the course of the last seven years.
“Thanks to favorable economic trends and supportive government measures, the number of people in employment has hit a new record high of 4 million 451 thousand,” said Minister for National Economy Mihály Varga last week on the latest jobs figures. With nearly 4.5 million people employed, that’s an increase of some 741 thousand from the level in 2010 when Prime Minister Orbán took office.
The jobs growth translates into 4.1 percent unemployment. That’s the lowest ever recorded in Hungary since the regime change in 1989, and it follows 63 consecutive months of steady decline. Hungary now ranks fourth in the EU among members with the lowest unemployment, only the Czech Republic out-doing Hungary in the region. This year alone, more than 38 thousand previously unemployed Hungarians have landed a job.
This government aims, as Prime Minister Orbán has said, to give every Hungarian that wants to work a chance to work and, what’s more, to make it worthwhile to go back to work. Wages have also seen a significant boost.
Thanks to the six-year wage deal brokered by the government last November, real wages grew by ten percent this year alone. As a result, the volume of retail sales has been following an unbroken upward trend for the last 50 months. This year’s figure marks an increase of 22 percent since 2010.
Rising household consumption, corporate investment projects, the booming home construction sector and the acceleration of EU fund disbursements all contribute to jobs and GDP growth.
The IMF recently revised upwards its growth forecast for Hungary and the World Economic Forum moved our economy up nine notches on its global competitive index. The markets, too, have noticed the Hungarian economic turnaround: Hungary’s five-year CDS premium fell below the 100 point-mark, to 98 points, at the end of September.
After teetering dangerously close to default in 2008, the Hungarian economy is back on track. Hungary is working again.