"In the past 75 years, every economic upswing has come about through a positive foreign trade impulse," Helmenstein underlined the importance of the Austrian export industry for the overall economic success of the country. In particular, neighboring Italy has developed significantly better than Austria in recent years. While labour productivity per person in employment has been stagnating in Austria for four years, it has risen significantly in Italy. In Austria, however, unit labour costs have increased by 53% since 2010, while the ratio in Italy has risen by only 15%. And Helmenstein also gave its southern neighbor a good report card in terms of energy supply: Unlike Austria, Italy has massively diversified it and also invested heavily in infrastructure.
Norman Schirmer led through the press conference with Markus Schmölzer, Franz Teuschler and Univ.-Prof. Dr. Christian Helmenstein (from left) © Günther Jauk
Helmenstein gave little hope for a rapid upswing with a statement on the development of building permits. In Austria, these have recently fallen by 63% compared to the 1st quarter of 2022 - and it would take six months to one and a half years for rising building permits to be reflected in the construction industry.
4 % growth expected
"In 2023, the sawmill industry had to react to the weak construction economy by reducing production," Schmölzer informed, adding that this had been done without any significant staff cuts. Specifically, sawn timber production fell by 10% to 9.4 million m³ in 2023, the lowest value since 2016, and this year the production volume is to be increased by 4% to 9.8 million m³. Schmölzer cited the increased costs for personnel, energy, maintenance and financing as particularly challenging, with sales prices stagnating since 2022. In order to get these production costs under control, sales prices must be raised.
Teuschler drew a similar picture. The timber trade is also confronted with sales and turnover losses in almost all areas. Building construction and single-family homes have collapsed, as has the furniture, window and flooring industry. The packaging sector is doing better than construction, but has also come under pressure recently. 2023 was a lean year for Austrian exporters - only the MENA region threw the industry a bit forward, according to Teuschler. Last year, softwood sawn timber exports fell by 8%, after which a recovery phase began in the first five months with an increase of 8%. However, the increased costs in sales could not be compensated.
Suspend regulations
Finally, Schmölzer called for a strengthening of the construction industry with further political measures, such as the suspension of the KIM Ordinance (strict regulations for the granting of real estate loans), the fight against inflation or the creation of affordable housing. Schmölzer and Teuschler did not leave a good hair on the deforestation regulation EUDR. According to Schmölzer, this is a prime example of how a well-intentioned idea can be completely ruined by misguided politics and legislation. He emphasized that the timber industry would certainly not oppose the idea that there would be additional deforestation. He called for a longer implementation period and a fundamental revision of the entire regulation.
