Why do we Hungarians go abroad and why do people from Asia come to work here?

"Although domestic wages have increased substantially in recent years, the persistently high cost of living continues to make it tempting to work abroad, and the proportion of emigrants is increasing," explains Attila Katkics, business consultant and HR specialist. "In a recessionary economic environment, already significant social disparities are widening, corruption and underpayment are coupled with high inflation and falling real wages, and weaknesses in the health and social care systems are prompting many to seek their fortunes abroad. But better working conditions, a better work-life balance, faster career progression, appreciation and professional challenges can also play a role." According to the expert, the decision to work abroad is usually made with a cool head, usually as a result of a well thought-out process, and is rarely spontaneous. It is important to gather information beforehand.

Is the country emptying out?

The most popular destinations for Hungarian workers are Germany, Austria and the UK, which is now outside the EU, but there are also large numbers of Hungarian workers in Switzerland, the Netherlands, Sweden and Ireland, as well as in the US, Canada and Australia. There are now almost 400,000 Hungarians living in the three hotspot countries, more than two-thirds of whom are in the labour force.

In addition, the number of Hungarians working abroad and commuting is stable at over 100,000, approaching the levels seen in the years before the Covid crisis.

"Generally speaking, there are three groups of people who work abroad: highly qualified Hungarian professionals, victims of the so-called brain drain, skilled workers and seasonal workers," says Attila Katkics. "The motivation is almost the same in all three cases, but the time frame is different, since a highly qualified professional typically stays for years, a skilled worker for a shorter period, and a seasonal worker typically comes from the border for a month or two, "he adds.

Hungary currently has an emigration rate of almost 7 percent for highly skilled workers.

The loss of young and skilled workers is a significant challenge for local communities and businesses. On a scale of one to ten, Hungary was a 4 in 2022, and on average, the highest proportion of highly skilled workers emigrated from our country. This means that their human capital (knowledge, skills, creativity) is now being used in another economy.

Is there a way back?

Working abroad tends to be the preserve of younger people, including single people at the start of their careers, but a senior manager aged 45-55 will typically take his or her whole family with them when they move. "Talent brain drain is not a recent phenomenon, but it remains one of the most pressing problems in Central and Eastern Europe, including Hungary, which is one of the countries least able to retain talent"," stresses Attila Katkics. The expert added that emigration cannot be prevented, but he called it a priority to reduce its quantity and quality and, at the same time, to create a sustainable return policy.

"The resources that have been abroad can bring to Hungary a network of contacts, new skills and vision, knowledge and ideas, which the Hungarian economy needs very much. The returning professionals stimulate trade and investment, spread knowledge and technology, and last but not least contribute to the budget through their taxes," the expert stressed.

Not enough reserves

Labour shortages are a complex problem, and symptomatic treatment will not bring about a meaningful improvement. The HR professional sees the need to use structured employment policy instruments to activate the existing labour market reserve.

Attila Katkics explained that due to economic policy priorities, third-country workers are also needed in Hungary, so reducing bureaucracy in employment and promoting integration is also a pressing task.

"At present, there are about 100,000 foreigners working in Hungary, the number of foreign workers is increasing by 1,000 per month, but according to some estimates, the upcoming major investments may require up to 500,000 new workers, while the domestic labour reserve may be sufficient to fill 100-150,000 jobs. The expert stressed that due to the tight labour market, the domestic economy is expected to need guest workers in the long term, who, unlike in previous years, will no longer come to Hungary from Serbia or Ukraine, but mainly from Asian countries.

Hungarians working abroad would come home for a high salary - read our previous article!

photo: freepik