What is Austria doing to keep track of the worker shortage?

Austria's labour shortage, particularly of skilled workers, affects almost every sector of the market. Now, the government wants to know exactly how bad the situation is.

Pictured is a business meeting.
Pictured is a business meeting.Photo by Gabrielle Henderson on Unsplash

The Austrian Ministry of Labour and Economic Affairs, in collaboration with the Labour Market Service (AMS), has unveiled the “BMAW AMS Skilled Workers Barometer” to improve the monitoring of labour shortages.

This quarterly index will provide timely information on the scarcity of skilled workers at the professional level in Austria and, in the future, for each individual province. Furthermore, it will be made public to allow the population to identify industries with a high number of vacancies.

What exactly is the ‘barometer’

The barometer is an index number calculated based on three sub-indicators: job placement (calculated by dividing the number of unemployed by the number of vacancies), access to vacancies (measuring the number of accesses and the relative change in access to vacancies), and the overall job market (counting the number and relative change of accesses to job advertisements).

​​READ ALSO: The ‘easiest’ entry jobs in Austria to get if you don’t speak German

During a press conference on Tuesday, June 6th, Martin Kocher, the Minister of Labour and Economic Affairs from the Austrian People’s Party (ÖVP), expressed confidence that the skilled worker barometer would help recognise labour market developments earlier and enable faster reactions to these changes. 

“The advantage of the new skilled worker barometer is not only to take as a basis those positions that are reported to the AMS, but also to be able to react more quickly to changes in demand,” said Johannes Kopf, the head of AMS.

However, he didn’t specify which reactions the government would take. 

Where is there a lack of workers?

According to domestic companies, there were 228,300 job openings in the first quarter of 2023, which is practically the same number as the previous year when there were 227,700 unfilled positions.

Of the current job vacancies, 134,700 can be attributed to the service sector, 61,100 to the manufacturing sector, and 32,500 to the public sector. Only 118,100 of these vacancies were reported to AMS by companies, as stated by Statistics Austria.

READ ALSO: Why job sectors in Austria are short of workers

One of the worst-affected sectors is construction, where 76 percent of companies report a shortage of skilled labour, as The Local has reported.

Both tourism and engineering also report a particularly acute shortage of workers, although nearly all sectors are struggling.

Regionally, the shortage is most pronounced in Carinthia, where 73 percent of companies report needing staff. This compares with about 67 percent in Upper Austria and only 20 percent in Vorarlberg.

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What I wish I knew before becoming ‘new self-employed’ in Austria

In any country, being self-employed has its rewards and drawbacks, but it helps to know them before starting out, explains Vienna-based freelancer David Everson-Baltas.

What I wish I knew before becoming 'new self-employed' in Austria

For many, being self-employed means autonomy, flexibility, and control over your working life. Sounds great, doesn’t it? But it can also mean long hours, working through holidays, and at times feeling less financially stable than your ‘regularly’ employed counterparts.

Austria offers both a challenging and rewarding environment for foreigners seeking a self-employed life in the heart of Europe, and while it presents an array of opportunities, it is essential to understand the ins and outs of life as a new self-employed worker (Neue/r Selbständige/r).

READ ALSO: Everything you need to know about becoming a freelancer in Austria

Who are the ‘new self-employed’?

New self-employed workers are essentially those who earn income from self-employment without needing a trade licence to do so.

As the Austrian Chamber of Commerce (WKO) requires that certain professions obtain a licence in order to operate legally, your first step is to find out whether you need one for your new business venture.

Don’t be caught out by assuming you don’t require one; it’s necessary, for example, to have a licence for jobs like translation and proofreading – professions you wouldn’t immediately associate with licensing.

READ ALSO: What is a regulated business licence in Austria and who needs one?

Dealing with bureaucracy

Once you have determined that you are indeed new self-employed, it’s time to prepare yourself for some form filling. From the day you start to work, you have four weeks to contact and register with the Finanzamt (Tax Office) and SVS (an insurance institution for the self-employed).

Austrian social insurance is a huge cost for freelancers, but it does go to your state pension later. Photo: Pixabay

This process can seem daunting at first, especially if you’re unfamiliar with Austria’s administrative procedures. While some staff at the Finanzamt and SVS are happy to switch to English, if you think your German skills aren’t up to the task, you may want to bring a German-speaking friend to help you at your appointments.

Payments to SVS are typically around 27 percent of the income declared in your tax assessment. This can come as a shock to expats, who often assume that this amount goes solely towards health insurance.

In reality, your monthly contribution (Beitrag) pays for your health, pension, and accident insurance, so when you eventually retire from what has hopefully been many years of rewarding and lucrative work, you will see some of that money returned to you as part of your pension.

READ ALSO: How freelancers in Austria can pay four times less in social insurance

Navigating tax declarations

Tax season can be an overwhelming period for the self-employed. While new self-employed workers certainly have an enviable level of drive and commitment, these virtues may not carry over into scrupulous record-keeping and navigating complex tax regulations. There are, however, ways to make this process more manageable and less stressful.

One option is to enlist the services of a qualified accountant. While certainly not cheap, they can be invaluable in simplifying the tax declaration process.

They have an in-depth knowledge of Austrian tax law, can – and often do – help you identify potential deductions, and ensure that you comply with all the relevant regulations. The money saved through these tax advantages often outweighs the accountant’s fees, making it a move you may wish to consider.

Austria’s tax rates are some of the highest in Europe, and after losing so much of your income to SVS contributions, you might feel a little deflated when having to pay your tax.

It is important to note that your taxable income is only the amount you have earned after your SVS payments have been deducted. As of 2023, the tax brackets have also been altered in order to combat growing inflation rates. You can find more information HERE.

READ ALSO: How to prepare your Austrian tax return if you’re self-employed

You are not alone

Becoming new self-employed is a challenging process that requires commitment and no small amount of research in order to do things correctly.

Regardless, there is a growing community of 7,000 new self-employed who are able to find most of the information they need via Self-Employed in Austria. This company, founded by a team of individuals, comprises legal and tax consultants, offers forums, advice, articles, and a much-loved 228-page book: The Complete Guide to Self- employment in Austria. The book is updated each year and provides a comprehensive guide for your journey towards self-employment.

Do you have any advice about being self-employed in Austria that you’d like to share with our readers? Leave a comment below or email us at [email protected]