Hungary - Working conditions

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The single most significant factor affecting employment in Hungary has been the change in the early 1990s from a communist economy to a free market economy. The collapse of the communist system and the wide-scale privatization of the means of production led to a huge displacement of Hungarian workers, causing unemployment to reach 13 percent in 1993. But as the economy has continued to improve since the mid-1990s, employment has improved. Unemployment in 2000 was 6.4 percent, a respectable figure even lower than in many West

Household Consumption in PPP Terms
Country All Food Clothing and footwear Fuel and power a Health care b Education b Transport & Communications Other
Hungary 25 5 17 6 20 12 15
United States 13 9 9 4 6 8 51
Germany 14 6 7 2 10 7 53
Austria 20 10 11 4 9 9 38
Data represent percentage of consumption in PPP terms.
a Excludes energy used for transport.
b Includes government and private expenditures.
SOURCE: World Bank. World Development Indicators 2000.

European countries such as France or Germany. This rate is down from approximately 10 percent in 1999. Unemployment varies regionally, being the highest in the eastern and rural areas. Most Hungarian employment is in the service industry, which accounted for 65 percent in 1996. Another 27 percent was employed in industry, and some 8 percent in agriculture.

Throughout the 20th century, Hungary has seen a net migration from rural to urban areas. Urbanization in Hungary's 5 major cities accelerated this process, even though, after Budapest, the 5 major cities have populations only between 127,000 and 210,000. Currently many workers commute to urban workplaces from rural areas. In 1996, some 25 percent of the nation's workforce commuted to and from their jobs in this manner.

A labor code was passed in 1992 which recognized the collective rights of workers, including the right to organize into unions and bargain collectively. This code includes the right to strike, extended to all workers except the police and the military. Following the passage of this code the number of strikes in Hungary increased dramatically, although most lasted for only a short time. The largest union is the National Confederation of Hungarian Trade Unions, with approximately 1 million members in 1993 (from a total labor force of 4.3 million). A number of other union federations also exist.

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