In times of economic uncertainty, fair pay can many times feel out of reach. For employees, and even employers as well, especially smaller organisations. When budgets are tighter and every forint, koruna, zloty or euro counts – it might be tempting to put compensation on the back burner for a while in favor of short-term savings. But what you may gain on your bottom line could end up hurting your long-term top line. Because you might want to ask the question: what if fair pay isn’t just a cost, but rather an investment? What if, especially in tougher times, offering just and transparent wages could be the very thing that sets your organization apart—not just morally, but strategically, and even financially positively in the long run?
Long story short: it can. But let’s dive in and take a look at why!
The tax on the poor
To understand why this matters so much, it’s worth taking a step back. Across Central and Eastern Europe, inflation has hit households hard. Even in countries where nominal wages have gone up, rising prices have often outpaced or have come very close to these increases—meaning workers are, effectively, earning about the same or even less.
Let’s look at the numbers from the past year or so:
- Hungary: November, December of 2024 and January 2025, gross average wages increased by an average 11.1 % year-on-year (Trading Economics). That sounds great until you consider that inflation hovered around 17.6% for much of the year before.
- Czech Republic: In Q3 2023, nominal wages rose by 7.1%, but real wages actually fell by 0.8%, thanks to consumer prices climbing 8.0% (csu.gov.cz).
- Romania: Net wages were up 17% in October 2023 compared to the previous year. But inflation meant real wages rose by 8.3% (Romania Insider). Still impressive but significantly less than 17.
- Slovakia: There’s been a slightly brighter picture here—real wages grew by 3% year-on-year in Q3 2024, but only by 1.6% in Q4, showing a significant easing from the 4.9% growth in Q2 (Trading Economics).
So while some countries managed to push real wages up, many workers across the region still feel like they’re barely making it even after the inflation shock of previous years—or worse. Also worth taking into account is the fact that while wage raises are averages, that can significantly be impacted by high rises in certain sectors or types of positions (while getting zero or very small amount in many others), rising consumer prices always hit the poorest the most. Especially given the fact that food inflation was usually the highest among all price rises, which makes up the highest percentage of the purchasing power of the less fortunate.
Why fair pay still matters, especially for small teams
This is where small organisations have a surprising edge. With flatter structures and more personal leadership, smaller companies often have more flexibility—and more accountability—to do the right thing. And in doing so, they can unlock some serious long-term benefits.
Let’s list a couple of reasons of why fair pay should be the number one priority in your talent strategy:
1. Talent retention without the drama
It costs a lot to lose a good team member—both in euros (forints, zlotys etc.) and morale. By committing to competitive, fair pay (and communicating about it transparently), you signal that you see your team’s value, not just their output.
2. Reputation, reputation, reputation
Employer branding isn’t just for the Fortune 500. In smaller circles, word spreads fast. Whether it’s through Glassdoor, LinkedIn, or just a friend-of-a-friend, being known as a fair employer boosts your visibility and attractiveness to potential hires—especially those who are weary of the “do more with less” mentality, which is far too widespread.
3. “Dog days will be over”
Here’s the big one. Organisations that invest in fairness now aren’t just surviving—they’re preparing. When the economy rebounds (and it always does), you’ll already have the trust, stability, and infrastructure to scale instead of scrambling to rehire or rebuild fractured teams. Your future self will surely thank your current self for making the right decision at the right time.
Fairness isn’t (just) about numbers
Of course, fair pay isn’t solely about matching inflation or benchmarking against national averages. It’s also about internal equity, pay transparency, and understanding what your team needs—not just to survive but to live a just and comfortable life.
It’s about asking:
- Are people in similar roles paid equitably across gender or age?
- Are junior staff stuck at unsustainable entry-level wages while senior leadership receives generous bonuses?
- Do we have a clear, structured way to talk about raises, inflation adjustments, and promotions?
Smaller organisations often have the opportunity to address these questions more quickly and directly than the ones with bigger bureaucracies and lots of internal red tape. Doing so sends a strong signal—not just internally, but to the market.
What about when you can’t raise salaries right now?
Sometimes, it can absolutely happen that the numbers just simply don’t stretch far enough. But fairness is also about honesty. If you can’t raise pay right now, acknowledge it—and be clear about your plans. Even a timeline or a future review can build trust.
You should also look at and discuss with your team openly:
- Flexible benefits (like extra days off or learning budgets)
- Profit-sharing or performance bonuses when feasible
- And openly communicating and involving your team in strategic decisions to build a sense of shared responsibility and ownership
Fairness is a choice: a choice to invest in your organisation’s future success
If you’re a small or mid-sized company in Hungary, Slovakia, Czechia, Poland, or Romania, the economic winds many times feel unpredictable. But committing to fair, transparent pay practices is something within your control. And it’s not just the right thing to do. As per all the reasons listed above, it’s also a competitive advantage. One that will position your company to attract better talent, build a more loyal team, and hit the ground running when the upturn finally arrives.
So don’t wait for the good times to be fair. Be fair now, and you’ll already be ahead when the “dog days are over”.
