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Persistent Economic Weakness Weighs on the Labour Market

Author

Listed:
  • Julia Bock-Schappelwein
  • Rainer Eppel

    (WIFO)

Abstract

In 2024, Austria's economic output shrank for the second year in a row (–1.2 percent). Companies suffered from weak demand at home and abroad, high energy prices and comparatively high unit labour costs. Private consumption declined despite rising real incomes. Manufacturing remained in recession. Construction and some service sectors such as retail trade also weakened. The persistent economic weakness also had an increasing impact on the Austrian labour market. In the economy as a whole, employment rose only slightly while manufacturing, construction and labour leasing faced significant employment losses. The unemployment rate increased noticeably again. The rise in unemployment continued in spring 2025. In addition to the weak economy, the inclusion of displaced persons from Ukraine in the unemployment statistics contributed to the increase in unemployment. The number of job vacancies continued to fall in 2024, but is still at a long-term high level. An improvement in the labour market situation is not expected until 2026 in the wake of a possible economic recovery.

Suggested Citation

  • Julia Bock-Schappelwein & Rainer Eppel, 2025. "Persistent Economic Weakness Weighs on the Labour Market," WIFO Reports on Austria, WIFO, issue 9, June.
    • Handle: RePEc:wfo:repoau:y:2025:i:9
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    File URL: https://www.wifo.ac.at/?p=426884
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