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How has the coronavirus pandemic impacted Austria’s job market?

Employment in Austria is being boosted by the relaxed lockdown measures and construction and industry are performing well, despite a massive economic slump due to reduced tourism.

How has the coronavirus pandemic impacted Austria's job market?
Photo: TOBIAS SCHWARZ / AFP

Employment in Austria is being boosted by the relaxed lockdown measures and construction and industry are performing well, despite a massive economic slump due to reduced tourism.

Employment is up

Shops, hairdressers and other services reopening on Monday has already boosted employment figures. There are 4,500 fewer people unemployed or in training than last week.

However, 525,992 people in Austria are still waiting to find work, according to figures from work minister Martin Kocher on Tuesday.

Construction performing 'relatively well'

The construction industry is getting through the economic crisis relatively well, with a drop of 1.6% in GDP,  Minister of Economics Schramböck announced. 

‘Skilled workers needed’ for industry

Economics Minister Margarete Schramböck said industry has created  450,000 jobs in Austria, and skilled workers are currently needed, even in the current crisis.

Industry is faring better in the pandemic than in 2019, when it was in recession, Wiener Zeitung recently reported.

Figures from Unicredit Bank Austria’s purchasing manager index show Austria's industry has been growing for seven months. 

In January the index reached the highest value for two years. Motorbike business KTM was mentioned by Minister Schramböck as one of the businesses which is looking for employees.

CLICK HERE FOR AUSTRIA'S JOB BOARD

Exports

Minister Schramböck is hoping Austria’s exports will be boosted by the recovery that is already emerging in Austria's most important export partners China and the USA. 

Massive economic slump

Gross domestic product (GDP) figures show there has been a massive economic slump in Austria. The latest calculations by the Wifo economic research institute, show domestic gross domestic product (GDP) was almost 14 percent below the previous year's level.

Tourism

Finance Minister Gernot Blümel says the reasons why Austria has suffered a worse economic slump than neighbouring  Germany, is its strong dependence on tourism. 

Due to the corona-related tourism lockdown, the Alpine republic is currently losing around 3.5 percent of total economic output per week in ​​the accommodation and gastronomy industries, according to the economic research institute Wifo. 

This has been exacerbated by lockdown measures for Austrians, as local tourism makes a significant contribution to Austrian hotels and restaurants, according to Blümel.

 

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WORKING IN AUSTRIA

Austria extends its short-term work system until the end of 2022

The Kurzarbeit system was limited until June; the Federal Government this Tuesday extended its validity.

Austria extends its short-term work system until the end of 2022

Austria’s short-term works scheme, the Kurzarbeit, which was set to expire by the end of June, was officially extended until the end of the year.

The scheme allows companies particularly affected by the coronavirus pandemic to ask for government assistance as long as they keep their workforce. Employees in Kurzarbeit work fewer hours and receive a fraction of their salary, paid by the scheme – up to 90 per cent, depending on their pay.

Discussions are still ongoing between the trade union and the Chamber of Commerce on the details of the short-time work extension, broadcaster ORF reported.

Employers want the government to increase the percentage of the salary paid to workers, asking all employees receive a 90 per cent net replacement for wages. Workers with higher salaries could receive as little as 70 per cent of their wages from the scheme, leading to a significant loss of income.

READ MORE: EXPLAINED: How to get your €500 Kurzarbeit bonus in Austria

Austria’s Labour Minister Martin Kocher said that the extension was only possible after “significant compromises” and that the system will only exist in very specific cases in the future. He didn’t give further details, though.

One of the reasons for the extension, ORF reports, was to cushion the economic consequences of the Ukraine war.

Kurzarbeit and unemployment rates

April 2020 saw the highest number of people, more than one million, on the scheme. Around 53,000 people were still pre-registered for short-time work at the beginning of the week. From March 2020 to the end of March 2022, government spending on coronavirus short-time labour amounted to € 9.56 billion.

READ ALSO: Six official websites to know if you’re planning to work in Austria

At the same time, the domestic labour market has seen a decrease in unemployment, even with the slowdown due to the war in Ukraine and soaring energy prices.

Compared to just one week ago, 4,216 fewer people were unemployed. Currently, 324,977 people are registered with the Public Employment Service Austria (AMS) as unemployed or in training. 251,633 of them are looking for a job, and 73,344 are in training measures of the AMS.

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