Household incomes in Austria shrink due to inflation
A survey conducted by the comparison portal durchblicker reveals that household incomes in Austria are struggling to keep up with inflation.
According to the research, three-quarters of households reported a decrease in income or insufficient income increases to cover the additional expenses caused by inflation in the first half of the year. The survey, which involved 1,200 households in May and June, sheds light on the financial challenges many families face in Austria.
Nearly six out of ten households feel a significant increase in their financial burden, with 58 percent stating that their fixed costs have risen significantly since the beginning of the year. As a result, 34 percent are using their savings to cover living expenses, while 17 percent are resorting to overdrawing their bank accounts or taking out loans to cope with the added costs.
"Due to high inflation, Austrian households continue to be pessimistic about the further development of their personal financial situation," Martin Spona of durchblicker said in a statement. However, the pessimism is no longer as pronounced as recently. "The sharp rise in rents and food costs are worrying more and more households. In the case of energy and fuel costs, their situation has eased somewhat."
READ ALSO: Cost of living: When will prices in Austria go down?
While optimism about the future was expressed by only 34 percent of households in a survey conducted nine months ago, that number has now increased to 40 percent. Nevertheless, six out of ten households still have worries, and nearly two-thirds believe there is significant room for optimising their fixed costs.
In terms of savings, Spona recommends that households carefully review their current electricity and gas providers to assess their current expenses. He emphasised that there can be substantial price differences among providers, which present opportunities for potential savings.
Who has been hit the hardest?
The survey highlighted that the decline in real income affected individuals on maternity leave, job seekers, single parents, and those in the 50 to 59 age group.
In terms of provinces, Burgenland has been hit the hardest in terms of purchasing power loss, followed by Salzburg and Upper Austria. Vorarlberg and Carinthia have fared relatively better, although most households in these regions still feel that their income development has not kept pace with inflation.
READ ALSO: Klimabonus 2023: Everything we know so far about Austria's subsidy payment
The impact of inflation has been particularly felt in everyday expenses such as food, restaurants and bars, and travel. Heating costs and electricity have replaced fuel as the primary drivers of fixed costs in the year's first half. Rent increases have been a significant burden for households during this period. On the other hand, savings have primarily been made in gastronomy, clothing, and travel.
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According to the research, three-quarters of households reported a decrease in income or insufficient income increases to cover the additional expenses caused by inflation in the first half of the year. The survey, which involved 1,200 households in May and June, sheds light on the financial challenges many families face in Austria.
Nearly six out of ten households feel a significant increase in their financial burden, with 58 percent stating that their fixed costs have risen significantly since the beginning of the year. As a result, 34 percent are using their savings to cover living expenses, while 17 percent are resorting to overdrawing their bank accounts or taking out loans to cope with the added costs.
"Due to high inflation, Austrian households continue to be pessimistic about the further development of their personal financial situation," Martin Spona of durchblicker said in a statement. However, the pessimism is no longer as pronounced as recently. "The sharp rise in rents and food costs are worrying more and more households. In the case of energy and fuel costs, their situation has eased somewhat."
READ ALSO: Cost of living: When will prices in Austria go down?
While optimism about the future was expressed by only 34 percent of households in a survey conducted nine months ago, that number has now increased to 40 percent. Nevertheless, six out of ten households still have worries, and nearly two-thirds believe there is significant room for optimising their fixed costs.
In terms of savings, Spona recommends that households carefully review their current electricity and gas providers to assess their current expenses. He emphasised that there can be substantial price differences among providers, which present opportunities for potential savings.
Who has been hit the hardest?
The survey highlighted that the decline in real income affected individuals on maternity leave, job seekers, single parents, and those in the 50 to 59 age group.
In terms of provinces, Burgenland has been hit the hardest in terms of purchasing power loss, followed by Salzburg and Upper Austria. Vorarlberg and Carinthia have fared relatively better, although most households in these regions still feel that their income development has not kept pace with inflation.
READ ALSO: Klimabonus 2023: Everything we know so far about Austria's subsidy payment
The impact of inflation has been particularly felt in everyday expenses such as food, restaurants and bars, and travel. Heating costs and electricity have replaced fuel as the primary drivers of fixed costs in the year's first half. Rent increases have been a significant burden for households during this period. On the other hand, savings have primarily been made in gastronomy, clothing, and travel.
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