The gap is getting wider: the purchasing value of pensions is deteriorating dramatically

By: Trademagazin Date: 2025. 04. 14. 11:03

The purchasing power of pensions compared to salaries will suffer another significant decline in 2025, according to new data from the Central Statistical Office (KSH). The average pension currently accounts for only 48.5 percent of average earnings, while in 2010 this ratio was 65.1 percent.

The gap between pensioners and active workers is growing

The financial situation of pensioners is constantly deteriorating compared to the salaries of active earners. While the purchasing power of pensions improved slightly last year due to government increases, this year they have already fallen by 6.4 percent compared to earnings. This means that wages are growing much faster than pensions, so the relative impoverishment of pensioners is accelerating.

Average pension: 222 thousand, but the majority receive less

According to the 2025 data, the average pension is 222,423 forints, but the median value – where half of pensioners receive less than this – does not even reach 200 thousand forints. Moreover, nearly 300 thousand pensioners – that is, every eighth – live on benefits of less than 120 thousand forints per month.

Among those with altered working capacity, for example, the average amount of disability benefits is only 133 thousand forints, and rehabilitation benefits are barely 67 thousand forints. These amounts no longer ensure a decent living, given rising inflation.

Inflation: the deteriorating standard of living behind the apparent increases

Although the government tried to keep the real value at the same level by adjusting the pensions for inflation after the 2023 pension increases (15% in January + 3.1% in November), this proved to be only a temporary solution. Although the increase at that time resulted in a real increase of 0.2 percent, inflation and wages have since disappeared.

Although pensions increased by 6 percent in 2024, the real value of earnings increased by 9.2 percent, so the relative value of pensions decreased even further.