Industry steps on the spot

The Austrian industry is still weak at the start of the second quarter of 2025. The shopping manager index (EMI) of Unicredit Bank Austria fell slightly by 0.3 points to 46.6 points in April – the growth threshold of 50 points was again clearly below. The domestic industry remains in the recession, but, in the face of global uncertainties, shows such a remarkable resilience, according to the Bank Austria economist.

« The turbulence around the erratic US customs announcements have so far hardly been reflected in the domestic industry, » says Stefan Bruckbauer, chief economist at Unicredit Bank Austria. Despite the decline in new orders, especially from abroad, the decline in production in April continued. The production index rose to 49.0 points – the highest value since summer 2024. However, while the overall euro area recorded slight production growth, Austria’s industry remained slightly in the shrinkage area. Austria lags behind European industry slightly, according to the analysis.

On the demand side, however, the Austrian industry recorded noticeable losses: the index of the export orders fell to 43.9 points in April, the lowest value of the current year. While German businesses benefited from advanced effects before the introduction of new US tariffs, such an impulse in Austria failed to materialize.

Job reduction continues, but slower

Employment reduction continued on the labor market, but the pace slowed down. The employee index rose to 47.1 points – the highest value in almost two years. « In the first year of 2025, the employee status in Austria’s material generation decreased by around two percent in the previous year or over 13,000 people to 625,000 people, » said Bank-Austria economist Walter Pudschedl. « The unemployment rate has increased to 4.3 percent adjusted for the season and is therefore not even half as high as in the overall economy. » Another increase is expected to 4.5 percent for the year as a whole.

Entry situation improved by companies

The earnings situation of the companies easily improved in April: Despite higher costs, the companies were able to raise their sales prices a little more, which led to a slight expansion of the profit margins. Bruckbauer particularly rated the increase in the index of the production expectations: with 55.9 points, it reached the highest level in ten months. « The concerns about the weak demand in a difficult competitive environment and any negative consequences of US customs policy were more than compensated for by the hope of tailwind through investment programs in Europe, especially in Germany, » said Bruckbauer. (APA)