Autrian manufacturing contracted sharply in June, 2023 – Is anyone surprised?

Austria’s government shut down most small businesses for the better part of a year. Then wondered why the economy suffered.

OPINION

With the European Union now struggling with one of the weakest performing economies in the world…

With the International Monetary Fund (IMF) wrong more than it is right when it comes to predicting recessions (hint: the UK is not in a recession, while the eurozone officially now is)…

With Austria still recovering from its government’s economically-disastrous Covid policies…

Advertising

Is anyone surprised to learn Austria’s manufacturing sector contracted sharply in June?

Then again when a government (Austria’s government of the ÖVP and Die Grünen) all but shuts down a country’s economy for the better part of two years over a virus with an overall 99.8 percent survival rate, it shouldn’t be much of a shock when fewer people have money to buy new products when all the government-pushed Covid bullshit ends.

According to Business Insider, a good indicator that the Austrian manufacturing industry could be in trouble is the UniCredit Bank Austria manufacturing Purchasing Managers’ Index, which dropped to 39.0 in June from 39.7 in the previous month.

That was the lowest score since April 2020.

Causes of course are the usual — consumers cutting back on spending on products they don’t necessarily need, lower construction orders due to not being able to afford to start new building projects or begin renovations, and customer destocking.

What is even more worrying is that the decrease in new orders in Austria is the fastest since March, 2009.

Advertising

As Austria’s largest export markets are primarily other EU countries (with the U.S. and Switzerland thrown in), many of whom are also now in recession or tottering on the brink, export orders have also declined rapidly.

With higher energy costs in the EU than in most of the rest of the world, the higher interest rates the ECB has implemented to try to bring down inflation causing credit for business expansion or house purchases to be more expensive, and EU taxes on purchases already some of the highest in the world, it is not likely Austria’s manufacturing sector will recover any time soon.

 

Cost of food in Austria has increased at a crazy rate since 2021. The cheese I used to buy has increased in price by over 45 percent. I no longer buy it

Am I the only one with any common sense?

Now, every time I see one of these gloomy reports coming out about the Austrian economy, I always feel like asking “Am I the only one with any common sense?’

I mean, I remember standing in the kitchen of my parents’ home back in the U.S. in mid-March, 2020 where I was stuck after the Austrian government closed the country’s borders, and I couldn’t get back to Vienna.

The Austrian government had just announced the first of what I knew at the time to be a number of worthless and economy-destroying lockdowns, and I said to my father, “Are they insane? What could locking people in their homes over a virus possibly do except destroy the economy?”

Fast forward three years and, as I predicted, the lockdowns, the mandated use of FFP2 masks almost everywhere (which apparently did nothing but ensure Austria ended up with the 4th highest number of Covid cases per capita), the hospitality and entertainment venue closures, the independent business closures, the shoving of endless amounts of ‘relief money’ into the economy and on and on, did nothing to stop people catching Covid-19.

They did, however, do a helluva detrimental job on the Austrian economy.

A detrimental job Austrians are still having to deal with when it comes to things like ridiculously expensive food prices, energy bills that have now almost tripled (mine have gone from €68 a month to €166 for a tiny studio apartment with no air conditioning, no washer or dryer and I never cook or turn on the heat), and the drastically higher prices of just about everything else.

So yes, Austrian manufacturing contracted sharply in June and, shocker, people are buying fewer products/starting fewer construction projects and spending less money than they did prior to early 2020.

Jesus, why is anyone surprised?

Michelle Topham
Advertising