Monday, May 16, 2022

THREE crises at the same time: Huge wave of short-time work is rolling towards us

THREE crises at the same time: Huge wave of short-time work is rolling towards us

The next few months will be tough: Delivery bottlenecks are currently slowing down production at Austrian companies, plus inflation and the consequences of the Ukraine war. Thousands of employees have to reckon with short-time work or job loss – the turquoise-green coalition wants to take countermeasures.

Richard Schmitt
16 April 2022 17:33

“It won’t be easy, there’s a lot coming our way now,” an insider from the Austrian federal government explained to eXXpress about the threatening scenarios, for which countermeasures are already being discussed and ordered in confidential crisis meetings.

Crisis 1: Due to the consequences of the corona pandemic and also due to the still tough zero-Covid measures in industrial metropolises in China, fewer and fewer raw materials are coming to Austrian companies. “There is a lack of semiconductors from China for the auto industry, but also many other raw materials,” warns the informant of eXXpress. As a result, more and more domestic companies are having to cut production – or maybe even stop it altogether. This immediately increases the number of applications for short-time work, and even layoffs will be unavoidable. This, in turn, leads to a slump in much-needed economic growth…

Vice Chancellor Werner Kogler (Greens)

Inflation plus CO2 increase

Crisis 2: The extremely high inflation. Inflation is currently putting a massive strain on Austrian households. “Of course, the question now arises as to how much politics can or should politics intervene in the market?” reports the government insider that countermeasures are already being taken in many areas. The price increase for fuel and gas, but also for food, should be slowed down.

The fact that the Greens want to continue to stick to their plan to further increase fuel prices with the CO2 tax also causes resentment among many politicians in the ranks of the government partner ÖVP.

The war in Ukraine also put a financial burden on Austria.

Enormous additional costs due to the war in Europe

Crisis 3: The war in Ukraine is now an additional burden on Austria. The economy, which is now supposed to recover after the tough months of the pandemic, has to cope with massive additional expenditure: 40,000 Ukrainian refugees have to be fed, cared for and financed – and Austria is also helping directly in Ukraine with civilian relief supplies and 17.5 million from the Budget of the government in Kyiv.

The greatest financial burden, which is necessary due to the Russian war of aggression, is yet to come: the modernization of the Austrian armed forces, which has now been recognized as absolutely necessary after decades, and its rearmament will cost additional billions in taxes.

Are you preparing for a coming economic crisis?

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