Lower Austria's economy optimistic: small relaxation in sight!

Lower Austria's economy optimistic: small relaxation in sight!

Wiener Neustadt-Land, Österreich - The Lower Austrian economy faces a maintenance process after recording a decline of 1.7 percent in 2024. As wn24 , the development is primarily shaped by weak impulses in industry and from the construction sector. The mechanical engineering and metal industry are particularly affected, while the food industry was easy to grow. The challenges are also evident in foreign trade, where Lower Austrian exports are expected to go back to less than 29 billion euros.

for 2025, Unicredit Bank Austria predicts a slight increase in regional product by 0.1 percent. This happens despite the uncertainties in the international economic environment and structural challenges in Germany. The bank's economic indicator shows a weak improvement after he rose the second month in a row in February 2025, but is still in the negative range of 2.2 points. The mood has improved in the service sector since the beginning of the year, while pessimism has dropped in industry.

labor market and inflation

In terms of labor market, an increase in the unemployment rate by 0.2 percentage points is forecast to 6.5 percent for 2025. These figures could indicate persistent economic uncertainty, because no improvement in the labor market situation is expected for 2026. While inflation was over 3 percent at the beginning of 2025, it should drop to an average of 2.5 percent over the course of the year. Bank Austria refers to factors such as relaxation of monetary policy and real wage growth that could contribute to the stabilization of the economy.

The forecasts for the entire Austrian economy also show a dark view. The gross domestic product (GDP) fell by 1.2 percent in 2024, with the possibility of escaping almost a third year of recession in 2025. In 2026 you even expect growth of 1.3 percent. These assumptions are supported by a hoped -for increase in private consumption and overall stabilized real wages. The OENB has determined that in Austria it falls to 3.4 percent, which results in a relaxation in consumption behavior of the population could have.

outlook and challenges

The Lower Austrian economy as a whole shows contradictory signals. While the service sector shows the first signs of stabilization, the expectations in industry are more steamed. Another decline in exports, especially in the categories machines and electronic products, could still have a negative impact on growth.

The coming months and years will be crucial for how well the Lower Austrian economy can recover from the setback. The challenges are great, but apparently there are also promising approaches through stabilization in the service industry and potential fiscal pulses. It remains to be seen how the markets develop and whether the population can benefit from an attractive consumption.