Hungary unemployment approaches ten-year high

Unemployment in Hungary is approaching a ten-year high as companies implement cost-cutting measures and workforce rationalization. According to Péter Virovácz, Chief Economist at ING Bank, the three-month moving average for the unemployment rate rose to 4.8 percent between June and August, placing it just 0.1 percentage points below the peak seen in late 2025.

Several factors are contributing to this negative trend. A drought-induced poor harvest has reduced the need for agricultural labor, and shifts following election results have left many displaced workers without new positions. Additionally, the labor supply has decreased by 180,000 people compared to the mid-2022 peak, driven by population decline and a reduction in economically active individuals.

Data from August shows a decrease of 21,000 employed persons compared to July, with 14,000 leaving the labor market entirely and 7,000 joining the ranks of the unemployed. The difficulty of finding work is also increasing, as one in three unemployed individuals has been searching for a position for more than a year. Looking ahead, upcoming decisions regarding wage agreements and potential changes to the personal income tax system are expected to create further uncertainty for employers.