Key Points To Know Before Investing in Hungary
Before investing in Hungary, you should know these basic facts about the workforce and infrastructure.
Workforce and Labor Environment
Hungary boasts a skilled, educated, and multilingual workforce. The country has a strong education system with high enrollment in secondary and tertiary education. Over 77% of Hungarians aged 25-64 have completed upper secondary education. The availability of skilled workers across various sectors is one of Hungary’s main attractions for investors.
Hungary produces around 60,000 graduates in engineering, IT and natural sciences each year. There are 226 higher education institutions and 31 accredited universities providing a large talent pool for investors. Knowledge of foreign languages is also widespread. Around 25% of the population speaks English while 10% know German.
Wages in Hungary are competitive compared to Western European countries. The average monthly salary is around €1,100. Personnel costs can be 30-35% lower compared to countries like Germany or Austria. Labor regulations are flexible allowing different forms of employment contracts. Tax burden on labor is around 36% which is lower than the EU average of around 40%. Unions have limited powers and strikes are not common. Overall, Hungary offers access to a productive, skilled and cost-effective workforce for companies and investors.
Infrastructure and Logistics
Hungary has a well-developed infrastructure that supports business operations and connects the country to major European and global markets.
Transport
– Hungary has an extensive rail network spanning over 7,600km that connects major cities and ports. Rail freight transport continues to grow and provides efficient distribution domestically and to neighboring countries.
– Road infrastructure is highly developed with over 200,000 km of paved roads including over 1,600km of expressways. The road system connects Hungary to Western Europe with major highways like the M1 and M7.
– Budapest Airport is a major regional hub serving over 14 million passengers annually. Low-cost carriers provide affordable connections across Europe.
– Hungary has two major commercial ports on the Danube River – Budapest and Baja. Baja is an important port for freight with trimodal transport connectivity.
Telecommunications
– Hungary has modern telecom infrastructure covering the entire country. Mobile penetration is over 100% and 5G networks are rapidly spreading.
– Internet is widely available with 87% of households connected. Broadband internet is affordable and speeds are high, supporting digital business needs.
Energy
– Hungary has a diversified energy mix including oil, natural gas, nuclear, coal and renewables. It has domestic fossil fuel reserves.
– Electricity access is universal and reliable. Hungary is interconnected to the European grid and a net exporter of electricity.
– Utility costs for businesses are competitive compared to other EU members. Hungary’s industrial electricity prices are below the EU average.
Logistics Infrastructure
– Hungary has seen robust logistics infrastructure development. It has over 5 million square meters of warehouse and logistics park space.
– There are over 30 dedicated industrial parks and free trade zones with excellent connectivity and services for businesses.
– Multinational 3PL providers like DHL, DB Schenker operate extensive distribution networks across Hungary.