Cold snap causes higher jobless rate

The number of unemployed people is on the rise in Austria.

Statistik Austria announced yesterday (Thurs) that 310,000 residents of the country had no job in February. This is an increase of 6.1 per cent compared to the same month of 2011.

Styria experienced the strongest increase among Austria’s nine provinces at 9.4 per cent. Salzburg (plus 8.7 per cent), Tyrol (plus 8.5 per cent) and Upper Austria (plus 7.1 per cent) suffered setbacks in fighting joblessness as well. Vorarlberg was the only region able to report a decline last month (minus 0.8 per cent).

Statistik Austria’s figures show that the number of employed Austrians rose as well last month. Around 3.4 million people had a job in February, up by 1.7 per cent compared to the same month in 2011. More than 70,000 people living in Austria aged 50 and above were out of work last month – 10.3 per cent more than in February 2011.

Austria’s youth unemployment shot up sharply. More than 45,000 Austrians aged between 15 and 24 had no work last month, up by 5.8 per cent. People’s Party (ÖVP) Integration Secretary Sebastian Kurz recently suggested ordering families of truants to pay higher fines to avoid their failure in school and traineeships. He said the maximum penalty of 220 Euros was too low in his opinion – and started a heated government-internal debate. It is understood that the ÖVP and its coalition partner, the Social Democrats (SPÖ), agreed on increasing the fine to 440 Euros shortly.

SPÖ Labour Minister Rudolf Hundstorfer said the weak European economy and the extreme cold of last month were the key reasons for the general unemployment increase. He pointed out that around 5,000 more builders than in February 2011 were registered as unemployed last month as their employers were forced to postpone projects due to the rough weather.

SPÖ and ÖVP intend to set up a charge of 110 Euros for each redundancy linked to an Austrian firm. Hundstorfer claimed this measure could keep some companies from registering their staff as unemployed for short periods such as in winter or during the Christmas holidays. This common procedure means significant administration costs for the Labour Market Service (AMS). Industrialists and businesspeople are upset about the government’s plan to fine firms after cancelling contracts on good terms with employees as well.

The government coalition decided to freeze the AMS’ annual budget to 981 million Euros in the next years despite economists’ warnings from rising unemployment. AMS director Johannes Kopf said last month that the number of jobless people may rise by 15,000 in 2012 compared to last year.

News that Austria experienced more jobless people but also residents in work last month follow uplifting but also and rather worrisome signals sent by the domestic economy.

The 40,000 Austrian enterprises which engage in export operations sold goods and services worth 122 billion Euros abroad in 2011 which is, according to the Federal Economy Chamber (WKO), a new record. Around 80 per cent of sales went to other European countries.

Tourism officials announced last week that 28 million overnight stays were registered in hotels and guesthouses across Austria between November 2011 and January 2012 – up by 0.6 per cent 2010/2011 winter holiday season. Rising interest by holidaymakers from Switzerland (plus 20.4 per cent) and Russia (plus 16.1 per cent) helped hotels to handle a 4.1 per cent decline in overnight stays booked by people from Germany.

Sport equipment dealers sold between 15 and 20 per cent fewer skis in 2011. Experts explain that more and more people are opting for rented skis to use the latest versions each season. Only on Wednesday, Austrian sport shop company Gigasport said it decided to close its 12 branches in the Czech Republic and Slovakia by the end of this year to focus on domestic business activities.