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Austrian Chamber of Labor: Loss in Real Income at 1.5%

Published: September 5, 2012; 19:12 · (Vindobona)

Between 2000 and 2010, the average inflation and tax-adjusted net income was down by 1.5% in Austria, AK (Austrian Chamber of Labor) says.

Austrian Chamber of Labor: Loss in Real Income at 1.5% / Picture: © Vindobona.org

Today, AK presented a study on the development of the real net income. Real income is declining since 2000, AK underlines. Above all, the low-income earners were mostly affected. In the same time, labor productivity was up by 8%.

According to AK, the declining real income is also due to the tax progression. If the income tax would have risen proportionally, tax intake had been down by € 518m, AK says.

AK published the study after a study of UBS caused substantial controversies. The authors of the study stated that Austria did not benefit at all from the introduction of the euro. Since 2000, the Austrian real income fell in all income groups, UBS reported. The highest decrease was observed for the poorest income group, for which the real income was down by 35%. The analyst Paul Donovan commented that Austria´s data are “alarmingly weak”. “

For OeNB, the study of UBS was „incomprehensible“. “These results are not plausible and contain substantial methodical problems. In fact, the inflation adjusted income was up by 12.2% from 2000 to 2010.” Austria´s Central Bank said. In an interview with the Austria newspaper “Presse”, Paul Donovan defended his report. Donovan rejected the critique and said to be sure about the correctness of the study. “I am sure that these figures represent the declining real disposable income.” Moreover, it would be no surprise that low-income earners have to suffer more from inflation than high-income earners.