Banking employment in Austria

The ongoing restructuring and consolidation process in the Austrian banking sector has drawn attention to banking employment developments. This article takes stock of the data on employment, labor costs and related indicators to provide a basis for discussion. Since 2008, the number of employees in banking has been on a slow, but permanent decline. Working hours have decreased even more strongly, reflecting a shift toward part-time work. Wage costs per employee are relatively high and have grown faster than those in most other sectors. However, until 2008, labor productivity growth outpaced labor cost growth. Since the crisis, labor cost growth has exceeded productivity increases, but less strongly than in the rest of the economy. Banks’ intensity of IT use has increased over the past 15 years. Not all IT investments were intended to substitute labor with capital. Instead, increasing IT usage in banks went hand in hand with a significant shift toward higher-skilled labor. Moreover, organizational changes related to the ongoing consolidation processes within the Austrian banking sector have contributed to the reduction in labor demand. Until recently, banks appear to have avoided layoffs, relying on attrition instead.