Last week AmCham Hungary has conducted a short survey to discover how our Members experience the unexpected inflation rates and the historically low Hungarian Forint exchange rates, as well as to provide a platform to share their plans and practices for further discussion.
The survey questions focused on the HR aspects of coping with inflation as an employer.
Compensating inflation
Based on the answer of 54 participants we can see that a significant portion (39%) of the survey participants have already provided some form of compensation for the unexpected inflation rate and one-third is still considering the option. Large and medium-sized companies tend to be more keen (and able) to provide some kind of compensation to their employees, although respondents vary based on their sector.
The forms of compensation are mostly extra salary increases (21%) throughout the year and one-off or multiple bonuses (18%). Salary increases varied between 2-15%, and the bonuses were mostly based on the inflation gap in a given period or were worth a month’s salary. The answers showed that a significant portion of the respondents gave the same amount or proportion of these compensations to all their employees, although there were cases where they were based on performance.
On the other hand, 18% of the participants are only planning to give compensation in the next financial year.
Indexing salaries
The vast majority (82%) of the participants are not planning to index HUF salaries to the EUR or USD, only 14% considering it to some extent, while 2% already have. It is important to note here that the Hungarian Labor Code only allows companies in Hungary to pay salaries in HUF, with some exceptions. With this question, we wanted to see whether any of our Members fall into those exceptions or if it is considered to index the salary increase to the change in the exchange rate of a foreign currency at all.
Please click here to see the results in numbers.
We would like to thank all those who participated in the survey and shared their actions and plans.