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Austria's timber industry experiences decline in difficult environment

'The timber industry held up relatively well in 2023 in a difficult environment. The continuing weakness of the construction industry is also leaving its mark on our industry.' This is the conclusion drawn by Herbert Jöbstl, Chairman of the Austrian Wood Industry Association. The 1289 member companies of the Austrian Wood Industry Association sold goods worth 9.8 billion euros in 2023, a decrease of 18.5 percent compared to the previous year.


'We see the trend of declining production throughout Europe and worldwide. In Austria, the timber industry is still well positioned in view of the recession,' emphasizes Jöbstl. But export figures are also lower. The foreign trade surplus was 1.5 billion euros in 2023, a decline of 14 percent. 'Our companies were able to hold their own at a high level on the international markets. With the right economic policy framework conditions, the timber industry will remain successful in the future,' Jöbstl emphasises.

Safeguarding jobs
Despite the difficult business situation, the number of employees in the wood industry is largely stable. 'Our companies have so far avoided extensive staff cuts,' emphasizes Dr. Erlfried Taurer, Deputy Chairman of the Board of Directors. of the Association of the Austrian Wood Industry. In 2023, the wood industry had around 27,400 employees, about 720 fewer jobs than in the previous year. The number of trainees in the companies has risen from 819 in 2022 to 826 in 2023. 'Our companies are a reliable employer even in difficult times. In the current environment, our companies are foregoing profits in order to retain the well-trained skilled workers as much as possible. No one cuts jobs without acute need. Especially in small and medium-sized companies, every trained specialist is needed. But that doesn't work permanently. Our members will soon have to earn money again and use their capacities efficiently,' warns Taurer.

Market environment remains tense
In view of the persistently weak construction industry, the German Wood Industry Association is calling for further impetus to revive the order situation in construction. 'We assume that construction activity will not increase in the short term. Building permits continue to decline. Projects that are not financed and approved now will not be built later,' says Dr. Andreas Ludwig, Deputy Chairman. of the Association of the Austrian Wood Industry. The latest housing package of the federal government is welcomed by the stakeholders of the timber industry. 'With the housing package, the federal government is taking a step in the right direction. However, until orders actually reach our companies, transitional measures such as deferrals and instalment payments for claims from the tax office and social security institutions are necessary,' Ludwig demands. If the measures adopted so far are not sufficient, further impetus is needed, for example the refund of VAT for construction services and materials. The Ordinance on Sustainable Lending Standards for the Financing of Residential Real Estate (KIM-VO) can also be suspended in view of high interest rates and stagnating real estate prices in order not to further restrict access to private construction financing. "If the weak construction industry continues for a long time, we will lose skilled workers and production capacities permanently. If demand picks up again later without sufficient production capacities being available, there is a renewed threat of supply bottlenecks and rising prices for building materials," warns Ludwig and demands: "We therefore continue to push for countercyclical investment incentives to maintain domestic value creation and jobs and to create the necessary living space."

Political framework necessary
Forests and timber have been the subject of frequent and controversial debate in the upcoming legislative period of the European Parliament in connection with the Green Deal. 'We expect a Green Deal with the wood value chain from the newly elected EU Parliament and the new EU Commission and not over our heads,' demands Herbert Jöbstl.

More information:
Holz Industrie
[email protected]

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