Gloomy prospects

“The principle of hope” applies to industry from 2025

The economy is simply not getting off the ground, and Carinthian companies are also facing job cuts. Apart from real crises, the mood is worse than ever.

"The hoped-for autumn upturn will unfortunately not materialize, we expect stagnation until mid-2025," explains Timo Springer, President of the Carinthian Federation of Industry. "From then on, the principle of hope applies. The mood among industrial companies is poor." This is shown by a survey of 61 companies with a total of 22,000 employees, and the topic of job cuts is also on the agenda. "Over a fifth are considering cutting jobs in the next few months, and that includes large companies," warns the IV President. "20 percent real cost increases in personnel will be difficult to achieve."

A look at the survey leaves little room for optimism. "We've been in the doldrums since October 2022, we'll soon be in the third year. And the companies still don't see any recovery," explains IV Managing Director Claudia Mischensky. Almost 80 percent believe that the stagnation will continue over the next six months, while a fifth describe the current business and order situation as "poor". Only in export business is the mood slightly better.

Reasons for the misery
Due to the poor mood, the IV has now declared "SOS prosperity". "The aim is to become internationally competitive again. We are currently a long way from achieving this," Timo Springer paints a gloomy picture and names the biggest problems: "The high costs are hampering investment, inflation, non-wage labor costs and bureaucracy are weakening competitiveness." In addition, the tax and contribution ratio of 43.2 percent is far too high.

In terms of taxation, we need to eliminate the disadvantages of full-time work. More performance must pay off.

IV-Präsident Timo Springer

"Part-time republic" Austria
"This rate should fall to 40 percent by 2030. We simply need a more efficient state," emphasizes the IV President. Another major problem is working hours. "Unfortunately, we are a part-time republic with a 30 percent share, which puts us in second place in the EU. And this is not only due to the childcare problem," explains Claudia Mischensky. "If we worked just 30 minutes more a day, we could double our current GDP growth."

However, this should not be achieved through penalties, but incentives. "It has to pay off for people to work full-time. The industry needs the workforce - a third of our members have more than ten vacancies," continued Mischensky. Financial incentives should also be provided for the employment of older people and pensioners.

Ongoing issues of pension problems and bureaucracy
"By 2050, the pension gap will be one trillion euros, and our pension costs are already four times higher than investments in research and development. Therefore, something urgently needs to be done about the retirement age," demands the IV President. At 60.9 years, Austria lags far behind the OECD average of 63.1 years.

Excessive bureaucracy is also slowing down the economy. "Politicians and the EU shouldn't keep filling companies with new reporting obligations," says Springer. "In our own company, two people are assigned just for such tasks." But there are also positive developments. "With the new Energy Transition Act, procedures can be handled much more quickly and easily, and this also applies to the Photovoltaics Ordinance," notes Mischensky. "This shows that steps can also be taken at regional level."

For this reason, Carinthian industry also wants to participate "with all our strength" in the bureaucratization process, emphasizes Mischensky, who concludes by praising the Carinthian workers and employees: "We are pointing out problems here, but the performance of the employees is excellent, they are perfectly trained."