Strengthening economy and employment in Hungary in 2025

By: Trademagazin Date: 2025. 02. 11. 11:50

According to the latest analysis by the Oeconomus Economic Research Foundation, Hungary’s economic performance has moved in a positive direction, and the country’s employment data also show a favorable picture at the EU level. In the fourth quarter of last year, GDP grew by 0.5 percent on a quarterly basis, ending the technical recession – the VG article points out.

This year’s GDP growth forecasts range between 1.8 and 3.4 percent, which predicts more dynamic economic expansion. The factors determining the growth are as follows:

Real wage growth and recovery in household consumption
Recovery of lending and growth in investments
Further increase in labor market activity
Recovery of industrial performance with the start-up of new car and battery factories
Expected increase in German industrial demand in the second half of 2025
Strengthening performance of the construction industry

Factors contributing to the economic recovery include the Rural Home Renovation Program, the increase in the guaranteed minimum wage and the Sándor Demján program.

Employment and Labor Market

Hungary continues to perform well in terms of employment, with the eighth lowest unemployment rate in the EU27. By 2025, the unemployment rate is expected to decrease further as the economy strengthens. The biggest challenges are the lack of skilled labor and the aging of society.

The geographical distribution of labor demand is different:

Northwestern and central parts of the country: significant labor demand
Northeastern and southwestern regions: higher labor reserve
Large investments and their impact

The Hungarian economy is also driven by large industrial investments. New plants of CATL, BMW and BYD are expected to start operating in 2025, which will generate significant labor demand and may result in a wage-raising effect in the affected regions.