Increasing poverty in Hungary

It was only a couple of days ago that I mentioned MSZP’s complaint that the data on the number of people living at the subsistence level and below the subsistence level (in poverty) in Hungary still hadn’t been released. One of the MSZP politicians whose expertise is social welfare issues claimed that the report was ready to be published at the beginning of May but that the government put pressure on the Central Statistical Office (KSH or Központi Statisztikai Hivatal) not to release it at that time. Well, at last the figures are out together with an indignant denial of MSZP’s accusations. Yes, said the press release, normally the figures are published before July 1, but this year because of the work that had to be invested in the census–which by the way was also late–KSH was a bit behind.

Before we go into the details of the figures and what they mean, let’s go back a bit in time. In early 2012 Zsuzsa Ferge, a well-known sociologist whose main field of interest is the Hungarian poor, predicted that if the trend of the last few years continues the number of people who live at the subsistence level will reach 4 million by the end of 2012. The trend was definitely moving toward growing poverty. In 2000 there were only 3 million people who were living at the subsistence level; by 2005, 3.2 million; and by 2010, 3.7 million. That was 37% of the population. Today’s figure is, as Ferge predicted, a shocking 40%.

The growing number of poor people (and here I use the term “poor” loosely to include both those living at the subsistence level and those living beneath it) come mainly from the ranks of the middle class–teachers, nurses, and other low-paid workers. The Orbán government’s social policy clearly favors those who belong to the top income bracket. Sociologist Balázs Krémer also wrote a study published alongside that of Ferge in which he demonstrated how the rich are getting richer while the poor are becoming poorer in Hungary. Between 2009 and 2010 per capita income grew on average from 910,000 to 940,000 forints per annum. However, during the same period the incomes of the poorest 10% decreased by 12,000. The top 10%, on the other hand, became 98,000 forints richer and later, when the Orbán government changed the tax law,  they saw their income grow by 314,000 forints per year.

Központi Statisztikai Hivatal, subsistence statistics per household

Központi Statisztikai Hivatal, subsistence statistics per household

According to KSH estimates, a family of four (two working adults and two children) need a minimum of 249,284 forints to maintain themselves on a subsistence level. That means 62,421 per person. A single-person household needs at least 86,000 and a two-person household 150,400 forints. KSH’s table is self-explanatory with the possible exception of  the last three items that refer to pensioners, living alone or with one or two others.

In Hungary 60% of the family income goes for food and shelter. For comparison here are a few figures from the United States. Shelter is a large chunk of the family income here too. About the same as in Hungary or a little more (34%), but an American family spends only 12% of their income on food as opposed to 31% in Hungary.

In addition to the 4 million people in Hungary who live at the subsistence level there are 1,3800,00 people who live below it. That number constitutes 13.8% of the population. So only 46% of the Hungarian population live above the subsistence level.

It’s no wonder that more and more people are seeking a new life abroad. Mostly in Germany and the United Kingdom. Last year Tárki estimated that about 20% of the adult population planned to leave the country. Since then these numbers have only grown. According to some recent polls, half of all high school and university students are contemplating leaving Hungary. Naturally, it is a lot easier to talk than to act. Most of these people will end up staying at home, but the numbers are still very high.

A few months ago György Matolcsy referred to the half a million Hungarians who live and work outside the country. He didn’t give any source, but journalists figured that he must have based his numbers on some statistics that were available only to government insiders. Now we have an official figure from KSH that accounts for part of this “diaspora”: 350,000 people still have a permanent address in Hungary but have been working abroad for some time. Most of these individuals, I suspect, are young people who are still registered as part of the family household.

This brings up an interesting point about the way that KSH calculates its employment statistics. KSH includes among the employed even those who actually work abroad, including the 350,000 people we are talking about here. KSH inquires whether József Kovács, who is living abroad, has a job; if so (and presumably if he’s in another country he is gainfully employed), he is counted among the Hungarian employed. If KSH didn’t include these people in their statistics, the Hungarian unemployment figures would be significantly higher.

Hungary has seen modest employment gains in the public sector due to the public works program.  But the salaries that workers in this program receive are way below the official minimum wage and are only about half the subsistence level for an individual. (And since only one member of a family is eligible for public works, he’s earning less than 20% of what a family of four would need to subsist on.) Yesterday Zoltán Kovács, undersecretary in charge of the public works program, refused to answer Olga Kálmán’s question as to whether 43,000 forints, the salary of a full-time (40 hours per week) public worker, is enough to live on. The interview is already available on YouTube.

Given the economic realities in today’s Hungary, I don’t expect any improvement in the living standards of Hungarians in the near future. And I think we should anticipate an even higher emigration rate, for both economic and political reasons.

Advertisements

16 comments

  1. This was on the Klubradio today. According to the KSH (Central Statistical Bureau = Hungarian Census Bureau) 7.4% of the Hungarians (age between 18-49), who has a permanent address in Hungary, lives abroad. That is 335 thousand.

    This is not the number of all emigrants. These are the ones who still maintain the home address.

    Their methodology was simple. They visited the addresses 🙂 and asked for the person.

  2. @Mutt: That’s funny 🙂

    But really, I was wondering how they got the number. In theory, if you go abroad to work, you can (should?) register at the local government as “temporary living abroad”. I know because that was my official status back at home for years.. until I decided that I really cannot call it temporary any more and changed it to “permanent”.

    But how many people go and actually report at the local government that they live “temporary abroad”? Most people don’t even know that they could (should?) do that. So I guess the number is even higher.

    Another way to get the number is from other EU countries… they seem to have estimates of how many Hungarians work there.

  3. Mutt :

    This was on the Klubradio today. According to the KSH (Central Statistical Bureau = Hungarian Census Bureau) 7.4% of the Hungarians (age between 18-49), who has a permanent address in Hungary, lives abroad. That is 335 thousand.

    This is not the number of all emigrants. These are the ones who still maintain the home address.

    Their methodology was simple. They visited the addresses :-) and asked for the person.

    Yes, thank you for mentioning it. At one point I had that piece of information in but as I was fiddling with the text it was left out by mistake. That 7.4% is a huge number.

  4. Mutt :

    Brash :
    “This was on the Klubradio today.”
    I stopped reading after that statement.

    What about the HVG?

    http://hvg.hu/gazdasag/20130711_KSH_335_ezer_magyar_lakcimu_felnott_el_ku

    or the index

    http://index.hu/belfold/2013/07/11/335_ezer_magyar_el_tartosan_kulfoldon/

    None of these will convince Brash. But perhaps the state-owned Magyar Távirati Iroda might:

    Statisztika-népesség
    RÖVIDHÍR – KSH: a 18-49 éves magyar állampolgárok hét százaléka él külföldön

    Budapest, 2013. július 11., csütörtök (MTI) – A 18-49 éves, Magyarországon állandó lakcímmel rendelkező magyar állampolgárok 7,4 százaléka, 335 ezer ember tartózkodik tartósan külföldön a Központi Statisztikai Hivatal (KSH) Népességtudományi Kutatóintézetének új módszertanon alapuló gyorsbecslése szerint.

    Kapitány Balázs, az intézet tudományos titkára csütörtökön, egy budapesti sajtótájékoztatón arra hívta fel a figyelmet, hogy az adat nem a kivándoroltak, hanem a külföldön élő, de Magyarországon állandó lakcímmel rendelkezők számára ad közvetlen becslést.
    A kutatásban 2012 novembere és 2013 februárja között 8917 embert kerestek meg hivatalos lakcímükön a kérdezőbiztosok.

    bBB \ ez \ hgp

    MTI 2013. július 11., csütörtök 14:52

    However, as far as I can see Magyar Nemzet forgot to publish this piece of news from MTI. I wonder why. And, you see, if it not in Magyar Nemzet then the news doesn’t exist.

  5. Last year myself and Ms O’Neill were wandering about in Durham, a middle-sizeish uni town in N England when we heard Hungarian being spoken by two young ladies. Turns out they were working there in a bar (not completely officially) and in that town alone they reckoned there were 100 Hungarians. 375,000 is an extremely conservative figure I reckon, even for the UK.

    Get yourself into the arrivals area in Ferihegy on a Friday evening and you will be shocked at the volume of temporary returnees versus tourists

  6. London Calling!

    One of the basic rules of National Statistics faculties is the requirement to publish stats to a fixed timetable.

    A rigid timetable – defined by the ‘as-independent-as-possible’ statisticians.

    It is a foundation factor of a democracy – so the statistics retain integrity and there can be no accusations of manipulation.

    In addition the appointment of head should be made at arms length from the Government – in essence appointed meritocratically.

    I have suspicions that Orban appoints attractive, inexperienced women to satiate his own ego – like wealthy footballer’s on a Saturday night having fun and flaunting their wealth and power in a nightclub.

    I believe ‘Gabriella’ is one such appointment. Too young and without the gravitas to indicate she would stand up to Government.

    I have been suspicious for quite a while now that this Codmocracy has been delaying potentially embarrassing statistics, for example, the confirmed population stats – which are flakey anyway. And now the poverty stats.

    Do you hear that Orban? A DEMOCRACY’s basic requirements – not your Commocracy manipulation.

    Regards

    Charlie

  7. The level of emigration since Viktor came to power is astonishing. Under Gyurcsany and Bajnai emigration was notable for being extremely low, compared with other new EU countries – and we put this down to motherland-attachment or mother’s-cooking-attachment (though a new phenomenon is actually mothers emigrating WITH their children, saucepans in tow). This is even more astounding if we consider how difficult a country Hungary is to actually LEAVE, legally (which I know from bitter personal experience), so insane are the levels of bureaucracy.

    And the rates are only increasing. Who is going to be the last one in Hungary to turn off the lights (albeit with a 10% reduction in cost, natch)?

  8. Good article!
    The perennial question, after seeing the KSH data chart above, is how do Hungarians manage to balance their household and existence budets under these conditions.
    Still a mistery to me after 20-30 years here!!!
    Perhaps the fact that a sizable proportion of the population got to buy their apartment from the state during the1980s at ludicrously low prices.
    The new generations however do not have this advantage, therefore itiss no wonder that they will sometimes choose to live and work outside the home country.
    (This above theme would deserve a separate article in itself).

    Indicative of the INTENTIONAL effort by state structures to mislead any constructive dialogue and promote isinformation in the statistical analysis of the economic theme is that, as in the case of the data-chart provided for this article, there appears to be no clearly and easaily identifiable reference as to whether the date is GROSS per capita income or NET income necessary to finance the stated minimums for above poverty-level existance.

    After all, it doesn’t need to be emphasiezed when we talk of minimal sums that delineate a filled stomach from a craving one, a 20% difference can make or break health, that is existence. We taling of bread and maragarine, heat or no heat, light or light cut off by the service provider. Its Pure and simple. A 20% difference can mean utmost pain.

    Listen, now: for the passt 3 years this regime has deliberately played the card of disinformation on this ABSOLUITELY CRITICAL MATTER. A 20-25% difference can mean the end of all ‘health’ as we imagine it, a level at which others in society no longer accept you because you are homeless, or dirty or unshaven, or unshowered, or plain undesirrable as judged by the remaining society that owns the money.

    Once again I’d like to underline that the confuseion caused by an inappropriiate or insufficient statment of facts in a chart of data can technically lead to the physical elimination of a whole class of unfortunate subculture.

    Net Income or Brutto Income, when you are slicing the last 25% of the minimum ‘vital’ can seem like the difference between 0 and 100 percent. (kindly allow me a slight exaggeration for poetic justice.) We’re close enough to the truth to let it be..

  9. Not too much OT:

    We visited my wife’s family in Eastern Hungary over the weekend and just returned. We had lunch at a “Pocakos Etterem” which is a kind of “All you can eat!” at the really low price of 1 200 HUF – and is was packed full!

    The quality was ok – though too much “rantott hús” for my taste and not enough salad and vegetables.

    We were told that it’s the only flourishing restaurant in that small town …

    We talked about politics an I was almost astonished that the family was well informed about the tobacco shop scandal, the land leases to Fidesz mafia going on and the head of the family could name all the Fidesz Oligarchs and their connection – from Simicska via Csany to Orbán’s father and also how they made/make their money!

  10. wolfi :

    Not too much OT:

    We visited my wife’s family in Eastern Hungary over the weekend and just returned. We had lunch at a “Pocakos Etterem” which is a kind of “All you can eat!” at the really low price of 1 200 HUF – and is was packed full!

    The quality was ok – though too much “rantott hús” for my taste and not enough salad and vegetables.

    We were told that it’s the only flourishing restaurant in that small town …

    We talked about politics an I was almost astonished that the family was well informed about the tobacco shop scandal, the land leases to Fidesz mafia going on and the head of the family could name all the Fidesz Oligarchs and their connection – from Simicska via Csany to Orbán’s father and also how they made/make their money!

    That is encouraging.

Comments are closed.