2020 Coronavirus – Economic Situation in Austria

A second wave of the ongoing Covid pandemic has hit Europe hard. With several countries – including Austria – in lockdown, the economy is heavily affected despite wide-reaching government support programmes

© Advantage Austria
© Advantage Austria

Austrian bank UniCredit’s Economic Research on Austria indicates that as result of the pandemic, economic output in Austria fell by almost 9% in the first half of 2020. Since hitting its lowest point in April, the Austrian economy has shown a high pace of recovery. The Government’s support measures have created a basis for a strong rebound in the third quarter up until the second lockdown in Austria . This will limit the decline in the economic output (GDP) in 2020 as a whole to -6.3%. The researchers expect Austria’s unemployment rate to average 5% in 2020 and 5.2% in 2021 as the government’s “Kurzarbeit” (ongoing government payment while working less/no hours for struggling companies) will not be sufficient to bridge the coronavirus crisis, with plant closures and personnel cutbacks to be expected. Austria’s economic output will probably not return to pre-crisis levels until early 2022.

For the bigger Eurozone, UniCredit’s economic research team expects the Eurozone’s economy to contract in 2020 by 8%, followed by an increase of 5% in 2021.