The Austrian trade and craft sector is facing a challenging period, with five consecutive years of decline signaling a critical situation for businesses. This article delves into the performance and outlook of the Austrian trade and craft sector, examining the key issues and challenges impacting its future. Learn about the governmentS proposed actions and industry leaders’ calls for support to navigate this downturn.
Austria’s Trade and Craft Sector Faces Continued Decline
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- Austria’s Trade and Craft Sector Faces Continued Decline
Vienna, austria – April 10, 2025
The Austrian trade and craft sector is grappling with a persistent downturn, marking five consecutive years of declining business volume. Key industry figures are calling for swift government action to reverse the trend.
Economic Overview: A Sector in Distress
Austria’s trade and craft industries concluded 2024 with a significant contraction, registering a 4.5% decrease. This continues a troubling pattern of diminishing business activity. SME research Austria indicates an overall decline of 0.3% in the past year.
Key Challenges:
- Persistent Decline: Five years of consecutive volume decline.
- Export Industry Impact: Mechatronics, metal technology, and plastic processing sectors especially affected.
- Building industry strain: Hafner, plate and tiler, ceramists, and timber construction also experiencing significant losses.
Industry Leaders Voice Concerns
Renate Scheikelbauer-Schuster, Chairwoman of the federal division trade and craft in the Austria Chamber of Commerce (WKÖ), addressed the concerning trends at a recent press conference.
That means: the trade and craft has shrunk by a fifth within five years. This is a really dramatic progress that goes to the substance.
Renate Scheikelbauer-Schuster, Chairwoman of the federal division trade and craft in the Austria Chamber of Commerce (WKÖ)
Scheikelbauer-Schuster emphasized the severity of the situation, highlighting the substantial contraction of the sector.
investment Decline: A Sign of Waning Confidence
Compounding the challenges, investments within the sector have plummeted to EUR 3.5 billion in 2024, down from EUR 4.2 billion in 2023. Future investment prospects appear bleak, with only 34% of companies planning proactive measures for 2025. This figure is lower than during the Corona year of 2020 (45%) and significantly below pre-pandemic levels of nearly 60%.
Q1 2025 Performance: A Weak Start
The first quarter of 2025 presented further difficulties. In consumer-related industries, 28% of companies reported losses, while only 18% experienced gains, resulting in a balance of -10 percentage points (%P). Health professions, vehicle technology, and mechatronics faced particularly negative developments.
Sector Performance Highlights:
- Negative Trends: Health professions (-28 %P), vehicle technology (-22 %P), and mechatronics (-21 %P).
- Positive Outliers: Hairdressers (+4 %P) and foot care, cosmetics, massage (+3 percentage points).
Investment-based industries also saw declines in average order stock, with construction, chemical commercials, monument/facade/building cleaning, and timber construction all experiencing significant drops. Carpenters and wood-shaping businesses were the exception, managing a slight increase from a low base.
Q2 2025 Outlook: Cautious Optimism
Looking ahead to the second quarter of 2025, expectations remain subdued. While 26% of companies anticipate further sales declines,17% project increases. The resulting balance of -9 percentage points is marginally better than the -14 percentage points recorded in Q2 2024.
Industry Demands Swift Government Action
Scheikelbauer-Schuster urged immediate action from the Federal Government to stimulate the construction industry and provide broader economic support.
In particular, our economic locomotive construction industry has to get going quickly. This will not happen on its own.
Renate Scheikelbauer-Schuster, Chairwoman of the federal division trade and craft in the Austria Chamber of Commerce (WKÖ)
She emphasized the importance of rapidly implementing measures outlined in the Federal Government’s work program, including residential building funding, incentives for heating exchange and thermal renovation, streamlined contracts for small companies, and the continuation of the craftsman bonus.
If you help quickly, you can definitely help twice. The earlier these measures are available and planning security, the better the companies can adjust to it.
Renate Scheikelbauer-schuster, Chairwoman of the federal division trade and craft in the Austria Chamber of Commerce (WKÖ)
To further boost residential building, the division proposes enhancing the attractiveness of housing bonds for private investors, tapping into Austria’s high savings rate.
We see a win-win situation: Households could pursue their savings goals with good conditions and would make a productive contribution so that living and ownership will remain affordable for the next generations.
Renate Scheikelbauer-Schuster, Chairwoman of the federal division trade and craft in the austria Chamber of Commerce (WKÖ)
Call for Bureaucracy relief
Reinhard Kainz, federal division managing director, noted initial signs of a shift in the EU’s approach to bureaucracy, highlighting the need to alleviate the burden on small and medium-sized enterprises.
He cited the “Omnibus package” as a potential step towards reducing bureaucratic obstacles, emphasizing the importance of sustained efforts to achieve a significant reduction in bureaucratic effort for smes.
We will remain stubborn in European harmony until the EU Commission declared a declared goal of reducing the bureaucratic effort for small and medium-sized companies by 35 percent.
Reinhard Kainz, federal division managing director
the “European Crafts Conference 2025” in Munich highlighted that similar challenges are faced across Europe. Small and medium-sized companies, which make up more than 99 percent of European companies, need to be considered more.
