Markedly Better Unit Labour Cost Position due to High Productivity Growth and Declining Euro

In an international hierarchy of labour costs, Austria ranks 11th, after Germany, Switzerland, the Scandinavian countries, Japan, the U.S. and the Netherlands. The labour factor is most expensive in Germany. At ATS 340 per hour of labour, German manufacturers pay more than a quarter over the Austrian rate. For Austrian manufacturers, a worker's hour costs ATS 270.40 in 2000, or 2.75 percent more than the EU average. Non-wage labour costs in manufacturing were 90.2 percent in 2000, a drop of 0.8 percentage points against 1999, due to lower severance payments. For the Austrian economy, its international position with regard to its unit labour cost fluctuated throughout the 1990s. In the first half of the last decade, industries in Austria found their situation deteriorating substantially, fuelled by rocketing wage inflation and an appreciation of the schilling in the wake of the EMS crisis, whereas in the second half relative unit labour cost came down by 2.7 percent p.a. compared to the average of Austria's trading partners and calculated in a single currency, the consequence of lower wage inflation, continuously high productivity growth (+5.3 percent p.a.) and a better currency standing. Altogether, the relative unit wage cost position for Austrian manufacturers improved by well over 10 percent in the 1990s. In 2000, unit wage costs declined by 6.0 percent, considering that the hourly wage rate went up by 1.9 percent and hourly productivity grew by 8.4 percent. Supported by the strong recovery of the yen and dollar, Austria's international unit labour cost ranking improved by 6.5 percent over the average of its trading partners and by well over 4.5 percent over the EU average.Arbeitskosten, Sachgütererzeugung, Österreich; Hohe Produktivitätszuwächse und Euro-Kursrückgang verbessern Lohnstückkostenposition; Markedly Better Unit Labour Cost Position due to High Productivity Growth and Declining Euro