Domestic Economy Continues to Recover Slowly

Austria's economy continues to recover slowly, but a stable growth phase cannot yet be spoken of, emphasized Statistics Director General Manuela Lenk. According to Lenk, there were still no noticeably positive impulses from individual sectors, private household consumption, and foreign trade. The industry grew by 0.4 percent compared to the previous quarter. The housing sector recorded an increase of 1.8 percent, while public administration, education, and health services rose by 0.7 percent. There were declines in accommodation and gastronomy with 0.9 percent and in construction, which recorded a decrease of 0.5 percent.

Wifo economic researcher Marcus Scheiblecker warned against too much optimism in view of the better economic data. "As long as we don't see the demand, we are skeptical," said Scheiblecker in response to an APA inquiry. Consumption in Austria is "creeping along" and exports as well as construction are "declining." However, it is "positive that the industry is slowly doing better," said the Wifo economist. Industrial companies are currently expanding their inventories and not noticeably selling more.

Public Sector Expenditure Increased

On the demand side, support mainly came from the state: Public sector consumption expenditure increased by 0.7 percent, while private household consumption expenditure decreased by 0.3 percent. Overall, consumption stagnated at plus/minus 0.0 percent. Gross fixed capital formation declined by 0.1 percent after increases in the first half of the year, mainly due to the continued shrinking of residential construction investments (minus 1.3 percent). Other construction investments (plus 0.7 percent) and vehicle investments (plus 0.9 percent) developed in the opposite direction.

Additional tailwind for the GDP came from an increase in inventories. However, the development was burdened by foreign trade: Exports fell by 1.6 percent in the 3rd quarter, and imports decreased by 0.5 percent. According to Statistics Austria, these opposing impulses reflect uncertainties in the global market.

Mixed Picture in the Labor Market

A mixed picture emerged in the labor market. Employee compensation at current prices increased by 0.9 percent compared to the 2nd quarter, while the total number of employees decreased by 0.3 percent. The number of employees was 0.1 percent below the previous quarter, and the number of self-employed decreased by 1.5 percent. The hours worked by employees increased slightly by 0.3 percent after declines in the first half of the year.

In the annual comparison, the positive trend continues: After an increase of 0.1 percent in the first and 0.4 percent in the second quarter of 2025, the real GDP in the third quarter was 0.9 percent higher than in the corresponding period of the previous year. The quarterly view also shows a gradual revival - from 0.2 percent growth in the first quarter through stagnation in the second to now 0.4 percent increase.

(APA/Red)

This article has been automatically translated, read the original article here.