Wage Wars: Metal Workers in Austria Demand Hefty Pay Increase Amid Inflation Surge

Wage Wars: Metal Workers in Austria Demand Hefty Pay Increase Amid Inflation Surge

Metal Workers Demand 11.6% Wage Increase

In Austria, metal workers, represented by the Federation of Austrian Industries (FMTI), are calling for a significant pay raise and improved working conditions. The primary demand is an 11.6% wage and salary increase, considering the annual inflation rate has risen to 9.6%, a stark increase from the previous year’s 6.4%. The union’s demand in the prior year was 10.6%; however, they eventually settled for a 7.4% wage increase.

Industry Leaders Pushback

Christian Knill, the FMTI chairman, along with the GPA and PRO-GE union representatives, argue the demands are excessively high. They worry that the metal industry, currently in a recession, would be further weakened by high wage agreements, especially given its export-focused nature. Karl Dürtscher (GPA) and Reinhold Binder (PRO-GE) emphasized the importance of preserving workers’ purchasing power in the face of soaring inflation. They are also advocating for an easier path to a sixth week of vacation and the option to exchange additional income for leisure time.

The Justification for Wage Hike

Unions justify their demands by highlighting the significant real wage losses employees have endured in recent months. They argue that workers can afford about 10% less than a year ago, equating to working one month for free. They also note the metal industry’s extensive profit distributions to shareholders in recent years, arguing that the wealth should be shared more evenly.

Addressing Apprenticeship Wage Gap

The unions are also focusing on the approximately 8,000 apprentices in the metal industry. They are pushing for wage equality for apprentices, comparing their wages to graduates of higher vocational schools after completing their apprenticeships. The current income difference at the basic level is 390 euros gross, a gap they hope to close.

Employers Cite Industry Challenges

Industry representatives note that wage costs in the metalworking industry amount to around ten billion euros per year. Even a one percent increase in wages would significantly inflate costs. They argue that a third of companies expect a negative operating result and are urging for realistic negotiations. The metalworking industry recorded a six percent decline in production in the first half of this year.

Looking Back to Look Forward

The Momentum Institute, a union-adjacent organization, calculated that wage purchasing power is as low as it was 11 years ago. They argue that workers have not been able to buy as much with their wages since October 2012.

Anticipating the Outcome

The first round of collective bargaining negotiations for the metalworking industry is scheduled to begin next Monday. Three dates have been tentatively set for these discussions. The new collective bargaining agreement is expected to take effect from November 1, 2023.