Pressure on workforce availability continues to drive significant wage rises of up to 100% in Hungary and other Visegrad 4 countries, says Continental, as continued interest from suppliers and OEMs in the region sees salaries remain competitive.
The boom in activity surrounding the Visegrad 4 countries of Hungary, Slovakia, Poland and Czech Republic shows no sign of abating, despite some startling wage settlement numbers emanating from government directives in particular, which illustrate the conundrum facing suppliers in the area.
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“If I look back at the last five years, the government was driving wage increases,” Continental Automotive Hungary GM and plant manager, Robert Keszte told just-auto at the recent Central & Eastern European Automotive Forum organised by Adam Smith Conferences in Budapest.
“There was political will to increase minimum wages, to improve the standard of living and living conditions of our citizens. We have some workforce shortage and the natural reaction was to increase wages to attract workers from other countries. There is nothing worse than not having enough workforce. We all face the same challenges – increasing labour costs. In all four countries, we have wage increase [s] of 60%, 80%, 100%.
“In the last two years, I see a tendency, unions are getting stronger in this topic. In Hungary we have some cases where unions are active and are successful in wage condition [demands] and even putting strikes on the agenda, to achieve even better wage increases.
“Here in Hungary, we have a great amount of projects still in the pipeline – for all these investments we still need workforce. I see still some pressure on wages – I see them in the high single digit figures. Yes, there will be an end to this period, because we see a slowdown in this industry.”
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By GlobalDataThe Bosch general manager noted however, Industry 4.0 techniques were starting to address some labour issues, by working more efficiently and not requiring as high an input from the human side. “In our factory in Budapest, we have more than 100 robots already,” added Keszte.
“In five years we will see the fast, positive impact of those 4.0 implications. My forecast is for the next three years having high pressure on wages in the region.
“We have stable industrial relations, but they are fragile. This might be an issue in the future, but for today I can say we have a good relationship with our unions and Works Council. I don’t [see] having fights in the near future.”
