Unions at the Hungarian factories of German carmakers Audi and Mercedes are calling for further wage hikes, as the country's labour market continues to tighten, local press reported on November 16.

Negotiations over a salary increase have reportedly been launched at Audi. However, workers at Mercedes are threatening strikes. Tensions have grown in labour relations this year in Hungary’s vital car industry due to an increasing labour shortage. A series of potential strikes were cancelled in the spring, but employees continue to claim that they are underpaid compared to workers in neighbouring countries.

Audi Hungary agreed in April to raise monthly basic wages by at least HUF15,000 (€48), retroactive to January. However, with the labour crunch showing no sign of abating, workers are now asking for an additional HUF55,000 (€177) from January 2017, according to Napi.hu.

At the Kecskemet facotry of Mercedes-Benz, Metalworkers’ Trade Union is thereatening a walk out over its demand for a 15% wage rise. Labour leaders claim they cannot accept a multi-step raise program offered by the company. The management of Mercedes-Benz Hungary earlier said it aims to reach an agreement with all workers.

Gross salaries at the 50 biggest firms in Hungary’s car industry fall short by some 30% in comparison to neighboring countries, a study by the Budget Responsibility Institute Budapest recently showed. According to the think-tank, if the government’s proposed cuts to social security contributions are implemented “wisely”, they could have a positive impact on Hungary’s labour market. In the long run, however, the country’s education system needs to be reformed in order to tackle structural problems.