Minister says unemployment increase is not a crisis
Alarm bells are ringing for politicians and businesspeople as the number of people with no job is on the rise again.
Social Democratic (SPÖ) Labour Minister Rudolf Hundstorfer announced today (Tues) that around 300,400 people were out of work last month. The minister explained that the number of unemployed residents of Austria rose by 0.8 per cent.
Hundstorfer claimed that the development was not meaning a crisis on the domestic job market but was more of a “bump”. He underlined that the government coalition of SPÖ and the conservative People’s Party (ÖVP) was “well prepared” if the economic mood worsened further in the coming months.
The minister revealed that he was ready to pour another 24 million Euros into to create stronger employment incentives next year. Hundstorfer added that applying the short-time support scheme again was an option as well. The coalition compensated hundreds of firms for some of their losses during the crisis if they kept employing their staff short-time instead of sacking them. The programme was extraordinary popular in 2009.
Figures presented today also show that the number of employed people increased as well. Around 3.45 million people were in work last month. These statistics identify Austria’s jobless rate as 3.9 per cent under criteria established by Eurostat, the European Commission’s (EC) research institute. Eurostat recently said Austria’s unemployment rate was 3.7 per cent in August. No other European Union (EU) member had a lower joblessness percentage figure that month. The Netherlands came second in this concern in August (4.4 per cent).
“The situation on the job front has become a bit more difficult,” Hundstorfer commented the September figures. He added: “We are well prepared and in a position to react adequately.”
Detail statistics reveal that more and more elderly people and women struggle to find a job. Labour Chamber (AK) President Herbert Tumpel appealed on the government for additional subsidies for these groups to tackle the situation.
The number of people sitting re-education courses provided by the Labour Market Service (AMS) in partnership with the labour ministry declined by nine per cent from September 2010 to the same month of this year to fewer than 65,400. The opposition is nevertheless expected to hit out at the government about its incapability of integrating more of them into the labour market.
The latest joblessness statistics are increasing the pressure on the Viennese city parliament coalition of SPÖ and Greens as they expose an 8.2 per cent jump in joblessness in the federal capital. The federal labour ministry’s research also shows that all but one provinces suffered unemployment rate increases. The western region of Vorarlberg was the only area to buck the trend.
ÖVP Economy Minister Reinhold Mitterlehner said on Sunday political decision-makers had to ensure that the current bank crisis did not affect the real economy. Mitterlehner said Austrian banks receiving financial support to get through the credit crunch could be ordered by law to keep accommodating firms with loans.
Economist Karl Aiginger said in September that his think tank, the Institute for Economic Research (WIFO), decided to correct its July forecast. He announced that the alpine country’s gross domestic product (GDP) will grow by 0.8 per cent from 2011 to 2012 instead of 1.8 per cent as initially predicted.
WIFO research suggested that a slight increase of unemployment was ahead for Austria as the number of people looking for work after school or at the end of traineeships would crawl up further. The outlook provided by the Institute for Advanced Studies (IHS) in September was similar.
Only last Friday, Bank Austria (BA) economist Stefan Bruckbauer warned that Austria’s industry could experience a “slight recession” in the next few months due to a decline of orders in October. Bruckbauer said the Austrian industrial sector would nevertheless manage to grow by seven per cent from 2010 to 2011 due to a strong performance in the first half of the current year.