The average net income in Austria is rising by 4.7 percent in real terms (i.e. adjusted for inflation), and by 4.2 percent in gross terms. The Upper Austrian Chamber of Labor (AK) highlighted these figures from the economic research institute Wifo at a press conference on Monday. This means that the loss of purchasing power in wages and salaries in recent years has been halted for the time being, said AK President Andreas Stangl together with Bettina Csoka from the AK Department for Economic, Social and Societal Policy: “But the cost of living crisis has not yet been overcome.”
With this year’s increase, net income will roughly reach the purchasing power level of 2020, i.e. before the start of high inflation rates. This is thanks to the collective wage and salary increases that the unions ultimately achieved with measures such as strikes, said Stangl. There are no metalworker negotiations this year because a two-year agreement was agreed in 2023. But there will be negotiations in the autumn, for example in the food and stone/ceramic industries and in trade.
Stangl expects “long discussions”. In view of the current difficult situation, the social partners should “sit down together and negotiate responsibly. The unions will not overburden the economy, and I hope that the economy will not demand any real wage losses from employees.” Compared to 2002, net purchasing power has increased cumulatively – from the AK’s point of view only – by 1.3 percent. According to its forecast for 2025, the Wifo expects real net income to increase by 1.3 percent.
Image: VOLKER WEIHBOLD
“}”>
Image: VOLKER WEIHBOLD
Six days before the National Council elections, Stangl sharply criticized the federal government and the state of Upper Austria. They had failed and “let inflation run wild.” Inflation has been three percentage points higher than in the eurozone since 2021, energy costs have risen by about a fifth, and rents have risen by about twice as much. Labor productivity, on the other hand, has risen by 20 percent in 20 years, around five percentage points more than in the eurozone.
The federal government has done nothing for employees, but tax breaks have been given to companies – with reference to the reduction in corporate tax by one percentage point. When asked about the extensive abolition of bracket creep, the valorization of social benefits and payments such as energy cost compensation and climate bonus, Stangl said that this ultimately did not do any more for employees. Companies were also affected by increased production costs, but they themselves fueled inflation with above-average price increases.
Stangl is calling for market interventions, for example in the energy sector, especially because the electricity price cap expires at the end of the year, and with rent caps. The imbalance in the tax system must be reduced, income from unemployment and training must be secured. “Excess profits” from banks and energy companies should be skimmed off.
