GDP climbs as real wages dwindle

More exports and higher activity of the country’s production sector have led to a 0.8 per cent increase of the Austrian gross domestic product (GDP) in the final quarter of last year, a think tank has announced.The Institute for Economic Research (WIFO) said today (Thurs) the GDP was 0.8 per cent higher between October and December 2010 than in the third quarter of the same year.WIFO experts – who saw just a 0.6 per cent improvement for the period last month – explained that increasing exports by Austrian companies and more material goods production meant that the economy did better than expected. Firms in Austria exported goods worth 99.87 billion Euros between January and November 2010, it was announced recently.WIFO stressed today that households have started to spend more than earlier on in 2010 and in 2009 when Austrians felt the pinch of the economic downturn. The institute however pointed out that amounts spent by citizens were increasing just slightly. WIFO also explained actual earnings were in decline due to soaring consumer prices for food, mineral oil, car fuel and other products.Industrial investments were improving as well, the think tank said. WIFO highlighted that the construction sector would not benefit from this upward trend. The institute said only last week that it expected investments in the building branch to edge up by only 0.7 per cent in 2011 compared to 2010. WIFO stressed that the Austrian GDP may improve by 2.2 per cent at the same time.Meanwhile, the situation on the job front continues to ease.Statistic authority Statistik Austria said earlier this month that 4.3 per cent of people living in Austria were out of work in February, down slightly compared to the same month of 2010 and recent months.The number of people failing to find a job long-term dropped by nearly 32 per cent in February 2011 compared to February 2010, while the youth jobless rate declined by 10.2 per cent.The European Commission’s (EC) statistic agency Eurostat announced 4.8 per cent of Austrians had no job in 2010, down from an average 4.9 per cent the previous year. Austria and the Netherlands took turns in having the lowest or second-lowest unemployment rate among the European Union’s (EU) 27 members in the past one and a half years.