The number of unemployed rose in double digits in March for the first time in months. Including training participants, 369,640 people were registered with the Employment Service (AMS) at the end of the month, 11 percent or almost 36,000 people more than a year ago. Of these, 291,468 were registered directly, and 78,172 people took part in AMS training.
AMS boss Johannes Kopf sees “a particularly bad development, especially since the deadline this year fell on Easter Sunday, which is generally favorable for employment.”
Austria is still clearly in recession
According to the expert, Austria is apparently still clearly in recession. “Unlike a year ago, when the forecasts only predicted a short economic downturn, I no longer believe in a rapid recovery in the sense of an early reduction in unemployment in Austria.” Due to the high inflation in this country, companies have not only lost competitiveness, but also have excess personnel capacity. “Even if growth returns, unemployment will probably only fall with a delay,” analyzes Kopf.
Strongest increase in industry and construction
The increase was greatest – excluding training participants – in construction (+21.7 percent) and in industry (+20.3 percent). Men were therefore affected much more than women, younger people more than older people.
“Compared to the years before the outbreak of the Covid pandemic, this is a low value,” commented Labor Minister Martin Kocher (ÖVP) on the latest labor market data. “The currently slightly higher unemployment rate than in March 2023 is primarily a result of the economically challenging environment.”
Kocher: The labor market is still very dynamic
The unemployment rate was 7.5 percent in the same month of 2019, before the outbreak of the corona pandemic. In 2020 it was 12.3 percent, in 2021 it was 9.3 percent, in 2022 it was 6.3 and a year ago it was 6.2 percent. There is currently “still a relatively high level of dynamism in areas of the Austrian labor market,” said Kocher. Areas such as construction or trade, for example, do not currently have this dynamic.
AK concerned about rise in long-term unemployment
The Chamber of Labor (AK) pointed to rising long-term unemployment again. People with health problems and the elderly are particularly affected by this. In addition, financial difficulties for households affected by unemployment would increase. “Unemployment must under no circumstances lead to poverty,” said the AK boss Renate Anderl. “The already poor relationship between unemployment benefit and previous income, the lack of adjustment to inflation and the complete devaluation of family allowances, which have not been adjusted since 2001, massively increase the risk of poverty in the event of a job loss.”
On the positive side, Kocher primarily referred to older employees aged 60 and over. In this group, there was recently an increase in employment of around 9 percent (or 14,844 people) to 181,546 people compared to the previous year.
Criticism from opposition
The two major opposition parties, SPÖ and FPÖ, criticized the turquoise-green federal government massively because of the surprisingly sharp rise in unemployment figures. From the point of view of the Social Democrats, there is inaction, according to social spokesman and FSG boss Josef Muchitsch. The Freedom Party sees the responsible labor and economics minister as a “squadroner,” according to a social spokeswoman Dagmar Belakowitsch. “ÖVP Labor Minister Kocher is just a neoliberal squadroner with no real and honest desire to shape things,” said Belakowitsch.
Muchitsch took up a statement from AMS boss Johannes Kopf, according to which there was a “particularly bad development” and that domestic companies had “lost competitiveness due to high inflation”. Muchitsch: “Everyone is now paying double or triple the price for the government’s inaction against record inflation in the form of record prices, recession and unemployment.”
“Something is not right here,” commented the ÖGB managing director Ingrid Reischl. “Unemployment in Austria continues to rise and at the same time the economy is demanding more and more skilled workers from third countries.” In tourism, for example, better working conditions are simply needed; it is not for nothing that people are looking for staff there so often, she also referred to recent controls in ski areas in which violations such as illegal employment were uncovered
Demand for workers remains high
The number of immediately available vacancies reported to the AMS fell by 18 percent year-on-year to 91,000. However, demand remains high in sectors with a high need for skilled workers, as the monthly count by the ÖVP Economic Association shows. Accordingly, there were 184,811 unfilled jobs in March.
According to the skilled labor barometer from the Ministry of Labor and the AMS, there are a good 3,200 jobs open in the electrical installation sector and a good 2,000 jobs as cooks. There should be relief overall and in specific areas an increase in work permits via red-white-red cards.