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Hungary performs only moderately well in overall well-being, as it ranks lower or close to the average in a large number of topics in the Better Life Index.
Money, while it cannot buy happiness, is an important means to achieving higher living standards. In Hungary, the average household net-adjusted disposable income is 13 858 USD a year, less than the OECD average of 23 047 USD a year. But there is a considerable gap between the richest and poorest – the top 20% of the population earn nearly four times as much as the bottom 20%.
In terms of employment, around 56% of people aged 15 to 64 in Hungary have a paid job, well below the OECD employment average of 66%. Some 61% of men are in paid work, compared with 51% of women. People in Hungary work 1 980 hours a year, more than the OECD average of 1 776 hours. Around 3% of employees work very long hours, much lower than the OECD average of 9%, with 5% of men working very long hours compared with just 1% for women.
Having a good education is an important requisite for finding a job. In Hungary, 81% of adults aged 25-64 have earned the equivalent of a high-school degree, higher than the OECD average of 74%. Around 84% of men have successfully completed high-school compared with 78% of women. In terms of the quality of the education system the average student scored 496 in reading literacy, maths and science in the OECD’s Programme for International Student Assessment (PISA), close to the OECD average of 497. On average in Hungary, girls outperformed boys by 9 points, in line with the average OECD gap.
In terms of health, life expectancy at birth in Hungary is 75 years, 5 years lower than the OECD average of 80 years. Life expectancy for women is 79 years, compared with 71 for men. The level of atmospheric PM10 – tiny air pollutant particles small enough to enter and cause damage to the lungs – is 15 micrograms per cubic meter, considerably lower than the OECD average of 21 micrograms per cubic meter. Hungary could perform better in terms of water quality, as 76% of people say they are satisfied with the quality of their water, lower than the OECD average of 84%.
Concerning the public sphere, there is a strong sense of community and moderate levels of civic participation in Hungary, where 90% of people believe that they know someone they could rely on in time of need, in line with the OECD average. Voter turnout, a measure of public trust in government and of citizens’ participation in the political process, was 47% during recent elections, below the OECD average of 72% and the lowest in the OECD. Voter turnout for the top 20% of the population is 53% and for the bottom 20% it is 39%, slightly wider than the average OECD difference of 12 percentage points.
In general, Hungarians are less satisfied with their lives than the OECD average, with 69% of people saying they have more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than negative ones (pain, worry, sadness, boredom, etc). This figure is lower than the OECD average of 80%.
OECD in Action
OECD Economic Surveys: Hungary 2014
OECD's 2014 Economic Survey of Hungary examines recent economic developments, prospects and policies with special chapters on enhancing competition and tackling labour mismatches.Read this report
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Hungary in Detail
Housing – Hungary expand
Living in satisfactory housing conditions is one of the most important aspects of people’s lives. Housing is essential to meet basic needs, such as shelter, but it is not just a question of four walls and a roof. Housing should offer a place to sleep and rest where people feel safe and have privacy and personal space; somewhere they can raise a family. All of these elements help make a house a home. And of course there is the question whether people can afford adequate housing.
Housing costs take up a large share of the household budget and represent the largest single expenditure for many individuals and families, by the time you add up elements such as rent, gas, electricity, water, furniture or repairs. In Hungary, households on average spend 20% of their gross adjusted disposable income on keeping a roof over their heads, close to the OECD average of 21%.
In addition to housing costs it is also important to examine living conditions, such as the average number of rooms shared per person and whether households have access to basic facilities. In Hungary, 79% of people say they are satisfied with their current housing situation, much less than the OECD average of 87%. This low level of subjective satisfaction reflects Hungary’s performance in objective housing indicators.
The number of rooms in a dwelling, divided by the number of persons living there, indicates whether residents are living in crowded conditions. Overcrowded housing may have a negative impact on physical and mental health, relations with others and children’s development. In addition, dense living conditions are often a sign of inadequate water and sewage supply. In Hungary, the average home contains one room per person, less than the OECD average of 1.6 rooms per person and one of the lowest rates in the OECD. In terms of basic facilities, 95.3%of people in Hungary live in dwellings with private access to an indoor flushing toilet, less than the OECD average of 97.8%.
More ResourcesHow's Life? at a Glance
Income – Hungary expand
While money may not buy happiness, it is an important means to achieving higher living standards and thus greater well-being. Higher economic wealth may also improve access to quality education, healthcare and housing.
Household net-adjusted disposable income is the amount of money that a household earns each year after tax. It represents the money available to a household for spending on goods or services. In Hungary, the average household net-adjusted disposable income is 13 858 USD a year, lower than the OECD average of 23 047 USD.
Household financial wealth is the total value of a household’s financial worth. In Hungary, the average household net financial wealth is estimated at 12 390 USD, lower than the OECD average of 40 516 USD. While the ideal measure of household wealth should include real assets (e.g. land and dwellings), such information is currently available for only a small number of OECD countries.
Despite a general increase in living standards across OECD countries over the past fifteen years, not all people have benefited from this to the same extent. In Hungary, the average net adjusted disposable income of the top 20% of the population is an estimated 25 395 USD a year, whereas the bottom 20% live on an estimated 6 273 USD a year.
More ResourcesHow's Life? at a Glance
Jobs – Hungary expand
Having a job brings many important benefits, including: providing a source of income, improving social inclusion, fulfilling one’s own aspirations, building self-esteem and developing skills and competencies. In Hungary, 56% of the working-age population aged 15 to 64 has a paid job. This figure is much lower than the OECD employment average of 66% and one of the lowest figures in the OECD. Employment rates are generally higher for individuals with a higher level of education; in Hungary an estimated 78% of individuals with at least a tertiary education have a paid job, compared with an estimated 26% for those without an upper secondary education. This 52 percentage point difference is much higher than the OECD average of 37 percentage points and suggests the job market in Hungary is considerably restrictive.
Women are still less likely than men to participate in the labour market. In Hungary, 51% of women have jobs. This is less than the OECD average of 60% and the 61% employment rate of men in Hungary. This 10 percentage point difference, however, is lower than the 12 percentage points and suggests Hungary could further improve employment opportunities for women but has generally been successful in addressing the constraints and barriers women face in accessing work.
Young Hungarians, aged 15-24, however, face difficulties, with an unemployment rate of 26.1% compared with the OECD average of 16.2%.
Unemployed persons are defined as those who are not currently working but are willing to do so and actively searching for work. Long-term unemployment can have a large negative effect on feelings of well-being and self-worth and result in a loss of skills, further reducing employability. In Hungary, the percentage of the labour force that has been unemployed for a year or longer is currently at almost 5.4%, higher than the OECD average of 3.1%. There is little difference on average between men and women in the OECD area when it comes to long-term unemployment. This is true in Hungary, where the long-term unemployment rate for men and for women is the same.
The wages and other monetary benefits that come with employment are an important aspect of job quality. In Hungary, people earn 19 437 US dollars per year on average, much less than the OECD average of 34 466 USD. Not everyone earns that amount however. Whereas the top 20% of the population earn 24 465 USD per year, the bottom 20% live on 9 595 USD per year.
Another essential factor of employment quality is job security. Employees working on temporary contracts are more vulnerable than workers with an open-ended contract. In Hungary, close to 8% of total employees have a contract of 6 months or less, slightly lower than the average of 10% for 30 OECD countries. This figure suggests Hungary has been successful in stabilising working contracts and encouraging open-ended contracts.
Better Policies for Better Lives
Tackling labour market exclusion of the Roma through education
In Hungary, the Roma represent around 7% of the total population. They suffer from widespread poverty and social exclusion, closely related to their significantly higher unemployment rate and marginalisation from the labour market. Lower educational attainment of the Roma contributes strongly to this employment gap. In order to improve their integration and especially labour market prospects, it is thus critical to reduce education gaps.
The Hungarian government has taken various measures to address the Roma education challenge. A recent policy measure takes a “sticks and carrots” approach to the issue: financially rewarding schools that accept Roma pupils beyond legal obligations and sanctioning those that refuse. The first assessments of this integration programme suggest that the performance of Roma students tends to rise, while that of the non-Roma is unaffected.
Although these targeted policies have a cost, they have succeeded in raising education attainments for the Roma and could prove to be a valuable investment. By leading to stronger employability of the Roma population, these policies benefit the national budget through higher tax and social security receipts and lower unemployment benefits during the working life of the individual.
More ResourcesWell‑being in the workplace: Measuring job quality
Community – Hungary expand
Humans are social creatures. The frequency of our contact with others and the quality of our personal relationships are thus crucial determinants of our well-being. Helping others can also make you happier. People who volunteer tend to be more satisfied with their lives than those who do not. Time spent volunteering also contributes to a healthy civil society. On average, people in Hungary spend less than a minute per day in volunteering activities, the lowest in the OECD where average is 4 minutes per day. Around 52% reported having helped a stranger in the last month, more than the OECD average of 48%.
A strong social network, or community, can provide emotional support during both good and bad times as well as provide access to jobs, services and other material opportunities. In Hungary, 90% of people believe that they know someone they could rely on in a time of need, in line with the OECD average. There is no difference between men and women. While gender has no impact on social network support, there is a clear relationship between the availability of social support on the one hand, and people’s education level, on the other. In Hungary, around 88% of people who have completed primary education report having someone to count on for help in times of need, compared to 95% for people who attained tertiary education.
A weak social network can result in limited economic opportunities, a lack of contact with others, and eventually, feelings of isolation. Socially isolated individuals face difficulties integrating into society as a contributing member and fulfilling personal aspirations.
More ResourcesHow's Life? at a Glance OECD Insights: Human Capital
Education – Hungary expand
A well-educated and well-trained population is essential for a country’s social and economic well-being. Education plays a key role in providing individuals with the knowledge, skills and competences needed to participate effectively in society and in the economy. Most concretely, having a good education greatly improves the likelihood of finding a job and earning enough money. Across OECD countries, 83% of people with university-level degrees have a job, compared with just below 56% for those with only a secondary school diploma. Lifetime earnings also increase with each level of education.
Following a decline in manual labour over previous decades, employers now favour a more educated labour force. High-school graduation rates therefore provide a good indication of whether a country is preparing its students to meet the minimum requirements of the job market. In Hungary, 81% of adults aged 25-64 have earned the equivalent of a high-school degree, higher than the OECD average of 74%. This is truer of men than women, as 84% of men have successfully completed high-school compared with 78% of women. This 6 percentage point difference is higher than the OECD average of 2 percentage points and suggests women’s participation in secondary education could be strengthened. Among younger people – a better indicator of Hungary’s future – 86% of 25-34 year-olds have earned the equivalent of a high-school degree, also higher than the OECD average of 82%.
Hungarians can expect to go through 17.5 years of education between the ages of 5 and 39, more than the OECD average of 16.5 years. This level of education expectancy echoes Hungary’s good performance in the educational attainment of its 25-34 year-old population.
But graduation rates, while important, speak little to the quality of education received. The OECD’s Programme for International Student Assessment (PISA) reviews the extent to which students have acquired some of the knowledge and skills that are essential for full participation in modern societies. In 2009, PISA focused on examining students’ reading ability, skills in maths and level in sciences, as research shows that these skills are more reliable predictors of economic and social well-being than the number of years spent in school.
The average student in Hungary scored 496 in reading literacy, maths and sciences, close to the OECD average of 497. On average, girls outperformed boys by 9 points, in line with the average OECD gap.
The best-performing school systems manage to provide high-quality education to all students. In Hungary, the average difference in results, between the 20% with the highest socio-economic background and the 20% with the lowest socio-economic is 132 points, much higher than the OECD average of 99 points and the largest gap amongst OECD countries. This suggests the school system in Hungary tends to provide higher quality education for the better off.
More ResourcesHow's Life? at a Glance
Environment – Hungary expand
The quality of our local living environment has a direct impact on our health. Having access to green spaces for example, is essential for quality of life. An unspoiled environment is a source of satisfaction, improves mental well-being, allows people to recover from the stress of everyday life and to perform physical activity. In Hungary, 11% of people feel they lack access to green spaces or recreational areas, slightly less than the 12 % average of OECD European countries.
Outdoor air pollution is one important environmental issue that directly affects the quality of peoples’ lives. Despite national and international interventions and decreases in major pollutant emissions, the health impacts of urban air pollution continue to worsen, with air pollution set to become the top environmental cause of premature mortality globally by 2050. Air pollution in urban centres, often caused by transport and the use of small-scale burning of wood or coal, is linked to a range of health problems, from minor eye irritation to upper respiratory symptoms in the short-term and chronic respiratory diseases such as asthma, cardiovascular diseases and lung cancer in the long-term. Children and the elderly may be particularly vulnerable.
PM10 – tiny particulate matter small enough to be inhaled into the deepest part of the lung – is monitored in OECD countries because it can harm human health and reduce life expectancy. In Hungary, PM10 levels are 15.1 micrograms per cubic meter, a great improvement from past levels and lower than the OECD average of 20.9 micrograms per cubic meter and the annual guideline limit of 20 micrograms per cubic meter set by the World Health Organization.
Access to clean water is fundamental to human well-being. Despite significant progress in OECD countries in reducing water pollution, improvements in freshwater quality are not always easy to discern. In Hungary, 76% of people say they are satisfied with water quality. This figure is lower than the OECD average of 84% and suggests Hungary still faces difficulties in providing good quality water to its inhabitants.
More ResourcesHow's Life? at a Glance OECD Environmental Outlook to 2030
Governance – Hungary expand
A cohesive society is one where citizens have a high degree of confidence in their governmental institutions and public administration. In Hungary, only 40% of people say they trust their political institutions, one of the lowest rates in the OECD area, where the average is 56%. High voter turnout is another measure of public trust in government and of citizens’ participation in the political process. In the most recent elections for which data is available, voter turnout in Hungary was 47% of those registered, the lowest figure in the OECD, where average turnout is72%.
Even if the right to vote is universal in all OECD countries, not everyone exercises this right. There is little difference in the voting rates of men and women in most OECD countries. This is the case in Hungary, where the voter turnout of men and women is similar, at respectively 47% and 46%. While on average there are few differences between men and women concerning participation in elections, income can have a strong influence on voter turnout. In Hungary, voter turnout for the top 20% of the population is an estimated 53%, whereas the participation rate of the bottom 20% is an estimated 39%. This 14 percentage point difference is slightly higher than the OECD average difference of 12 percentage points.
Ensuring that government decision making is not compromised by conflicts of interest is key to maintaining trust in government. Transparency is therefore essential to hold government to account and to maintain confidence in public institutions.
Freedom of information laws (FOI) allow the possibility for individuals to access undisclosed information. For such policies to be successful, the public should have a clear understanding of their rights under the law, should be able to file requests with ease and should be protected against any possible retaliation. People in Hungary can file a request for information either in writing, online, by telephone or in person – thus greatly facilitating the FOI process. There are even provisions for anonymity – an important protection that few OECD countries have adopted. There is not yet, however, built-in protection from retaliation.
More ResourcesHow's Life? at a Glance
Health – Hungary expand
Most OECD countries have enjoyed large gains in life expectancy over the past decades, thanks to improvements in living conditions, public health interventions and progress in medical care. Life expectancy at birth in Hungary stands at 75 years, five years below the OECD average of 80 years. Life expectancy for women is 79 years, compared with 71 for men, a slightly larger difference than the average OECD gender gap of six years, with a life expectancy for women living of 83 years and 77 years for men.
Higher life expectancy is generally associated with higher healthcare spending per person, although many other factors have an impact on life expectancy (such as living standards, lifestyles, education and environmental factors). Total health spending accounts for 7.8% of GDP in Hungary, less than the 9.5% OECD average. At 1601 USD in 2010, health spending per person in Hungary is about half the 3268 USD OECD average. Between 2000 and 2009, total health spending in Hungaryincreased in real terms by 2.9% per year on average, a slower growth rate than the OECD average of 4.7%. This growth rate then slowed down to 2.0% in 2010.
Throughout the OECD, tobacco consumption and excessive weight gain remain two important risk factors for many chronic diseases. While the percentage of adults who smoke every day has come down in Hungary from 35.5% in 1994 to 26.5%, it is still above the OECD average of 21.1%. In many OECD countries, large proportions of the population are overweight or obese. In Hungary, the obesity rate among adults is 28.5%, much higher than the OECD average of 17.8%. Obesity’s growing prevalence foreshadows increases in the occurrence of health problems (such as diabetes, cardiovascular diseases and asthma), and higher health care costs in the future.
When asked, “How is your health in general?” 55% of people in Hungary reported to be in good health, much less than the OECD average of 69%. Despite the subjective nature of this question, answers have been found to be a good predictor of people’s future health care use. Gender, age and social status may affect answers to this question. On average in OECD countries, men are more likely to report good health than women, with an average of 71% for men and 66% for women. In Hungary, the average is 59% for men and 52% for women. Not surprisingly, older people report poorer health, as do those who are unemployed, or who have less education or income. About 69% of the top 20% of the adult population in Hungary rate their health as ‘good’ or ‘very good’, compared to about 51% for the bottom 20%.
More ResourcesHow's Life? at a Glance
Life Satisfaction – Hungary expand
Happiness or subjective well-being can be measured in terms of life satisfaction, the presence of positive experiences and feelings, and the absence of negative experiences and feelings. Such measures, while subjective, are a useful complement to objective data to compare the quality of life across countries.
Life satisfaction measures how people evaluate their life as a whole rather than their current feelings. It captures a reflective assessment of which life circumstances and conditions are important for subjective well-being. When asked to rate their general satisfaction with life on a scale from 0 to 10, Hungarians gave it a 4.7 grade, the lowest in the OECD where the average is 6.6.
There is little difference in life satisfaction levels between men and women across OECD countries. This is true in Hungary, where men gave their life a 4.8 grade and women 4.6. Education levels do, however, strongly influence subjective well-being. Whereas people who have only completed primary education in Hungary have a life satisfaction level of 4.1, this score reaches 5.6 for people with tertiary education.
Happiness, or subjective well-being, is also measured by the presence of positive experiences and feelings, and/or the absence of negative experiences and feelings. In Hungary 69% of people reported having more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than negative ones (pain, worry, sadness, boredom, etc). This figure is lower than the OECD average of 80% and among the lowest in the OECD.
More ResourcesHow's Life? at a Glance
Safety – Hungary expand
Personal security is a core element for the well-being of individuals, and largely reflects the risks of people being physically assaulted or falling victim to other types of crime. Across the OECD, assault rates have generally declined in the past five years. In Hungary, 3.6% of people reported falling victim to assault over the previous 12 months, less than the OECD average of 4.0%. There is little difference between men and women in assault rates, at respectively 3.4% and 3.8%.
The homicide rate (the number of murders per 100,000 inhabitants) is a more reliable measure of a country’s safety level because, unlike other crimes, murders are usually always reported to the police. According to the latest OECD data, Hungary’s homicide rate is 1.3, lower than the OECD average of 2.2. In Hungary, the homicide rate for men is 1.5 compared with 1.1 for women.
Fear of crime is another important indicator as it can constrain behaviour, restrict freedom and threaten the foundation of communities. Despite a general reduction in assault rates in the past five years, in many OECD countries feelings of security have declined. In Hungary, 51% of people feel safe walking alone at night, lower than the OECD average of 67%. While men are at a greater risk of being victims of assaults and violent crimes, women report lower feelings of security than men. This has been explained by a greater fear of sexual attacks, the feeling they must also protect their children and their concern that they may be seen as partially responsible.
More ResourcesHow's Life? at a Glance
Work-Life Balance – Hungary expand
Finding a suitable balance between work and life is a challenge for all workers, especially working parents. Some couples would like to have (more) children, but do not see how they could afford to stop working. Other parents are happy with the number of children in their family, but would like to work more. This is a challenge to governments because if parents cannot achieve their desired work/life balance, not only is their welfare lowered but so is development in the country.
People spend one-tenth to one-fifth of their time on unpaid work. The distribution of tasks within the family is still influenced by gender roles: men are more likely to spend more hours in paid work, while women spend longer on unpaid domestic work. Men in Hungary, spend 127 minutes per day cooking, cleaning or caring, less than the OECD average of 131 minutes and less than half as long as Hungarian women, who spend 268 minutes per day on average on domestic work.
Another important aspect of work-life balance is the amount of time a person spends at work. Evidence suggests that long work hours may impair personal health, jeopardize safety and increase stress. People in Hungary work 1 980 hours a year, more than the OECD average of 1 776 hours. The share of employees working more than 50 hours per week is not very large across OECD countries. In Hungary, some 3% of employees work very long hours, less than the OECD average of 9%. Overall, men spend more hours in paid work: in Hungary 5% of men work very long hours, compared with 1% for women.
Better Policies for Better Lives
More support to families can boost fertility in Hungary
At 1.33 children per woman, the total fertility rate in Hungary is the 3rd lowest across the OECD (the average is 1.74). The decline in fertility started in the 1980s, and accelerated in the early 1990s. Since 2000, fertility rates stabilised in Hungary, while about half of the other OECD countries experienced an increase. Low fertility goes hand in hand with low employment among women. In 2010, the female employment rate was just below 50% (10 percentage points below the OECD average), and at 46% in 2007, the maternal employment rate was the lowest of the European OECD countries.
Low fertility and female employment rates are largely explained by insufficient support for parents to reconcile work and care commitments. Hungary is among the top OECD spenders on families with 3.3% of GDP allocated to family benefits in 2007. However, only 1/3 of these resources are spent on helping with childcare costs, while this share is above 43% in countries with higher fertility rates.
The prolonged duration of parental leave and the limited provision of childcare supports establish barriers to employment for many mothers. Parental leave can last up to 3 years (compared with 1.5 years on average across the OECD) and be combined with a cash-for-care payment; a parent of three or more children can even stay at home and receive this benefit until the youngest child is eight years old. Moreover, less than 9% of children under age 3 are enrolled in formal childcare services.
Hungary has recently introduced a tax relief for households with large number of children, which might have a positive influence on birth rates. However, the evidence from other countries is that a wider provision of formal childcare services is a more effective tool for helping parents with work and family commitments and thus raise birth rates.