It is expected that 500 jobs will be lost by the end of the year! This issue was leaked shortly after the three insolvency proceedings at KTM were opened. A first indication that the restructuring of the motorcycle manufacturer will cost many jobs. The employment service is preparing for a rush of unemployment registrations in the region, as many supply companies are now starting to falter.
More than 3,600 employees work at the three companies affected by the bankruptcy: KTM AG, KTM Components GmbH and KTM Forschungs & Entwicklung GmbH. The motorcycle manufacturer owed them November salaries and the Christmas bonus, which are now being belatedly transferred to the bankruptcy fund, and there is also the uncertainty of what will happen next.
We spoke to Iris Schmidt, director of the Public Employment Service in Upper Austria, who is preparing for a sharp increase in unemployment registrations.
“Kron”: The bankruptcy filing of motorcycle manufacturer KTM amounts to an earthquake in the Braunau region. Of the more than 3,600 employees at the affected companies, 500 are expected to leave by the end of the year. How does the AMS deal with this?
Iris Schmidt: It is not yet clear what dimension this will actually have, how many people will ultimately be released, because it will only become clear in 90 days whether the restructuring plan will be approved. The fact is: many suppliers are affected by this situation and do not know what will happen next. They have bills to pay for deliveries they ordered for KTM. We do not know whether there will be additional exemptions there, even if they are temporary.
From Monday, company meetings will be held directly on location at KTM by the insolvency experts of the Chamber of Labor.
These are a good step for the employees who are currently affected, so that there is at least some clarity about what the situation means for them. Now it’s really a matter of seeing how high the requirements are. We as AMS are not yet in demand.
Two and a half weeks ago, KTM’s problems became public knowledge. Since when has the AMS been preparing?
In October we had an 18 percent increase in the number of pre-registered people in Upper Austria compared to the previous year. It was already clear that we had to prepare if winter unemployment came. That’s why we spent the entire month of November focusing on what we can do – first on a small scale, now on a large scale.
What can you imagine about these preparations?
We prepare, gather our employees and ask them to let us know which of the part-time employees can increase their hours and how many overtime they can work. On the other hand, we look at which agendas we can now push back. We put things that are not so important on the back burner. We are now focusing our full capacity on unemployment registration and then on unemployment claims. As a result, we no longer have any staff, but are now joining forces as we did during the Corona period, when we were faced with short-time working and the increase in unemployment benefits. Securing the livelihoods of those affected is the top priority. People already have enough uncertainty.
There is also a lot of uncertainty and uncertainty for the AMS.
We don’t know exactly when people will come to us. But when they arrive, we need to be prepared so we can support people as best we can from day one. That’s what we’re doing now. We are already in discussions with other federal states, such as Lower Austria, so that they can calculate these applications if necessary. However, the reservation must be made on site. This means: we are preparing for teams on location in Braunau.
But your focus is not only on the Braunau region.
We know many other companies that adjust their sizes. We also have other regions where people are temporarily released. And we have to take care of them too. We just have to be prepared so that we can be on site everywhere or have the necessary capacity in the background to process the requests. This is now a priority.
Besides KTM, many companies are having problems. Wage cuts, shorter working hours and job losses are the order of the day.
We now know that it is a structural problem in the sector. And unlike previous crises, where it was relatively easy to move people into other companies because things were going well there, the difficulties are now widespread. This will take longer. Now we have to find ways to deal with it.
Next week there will be a roundtable discussion with the state of Upper Austria, AMS, the Chamber of Labor and the Chamber of Commerce.
Very close coordination is needed between the social partners, the state and the AMS, because we now have to think about foundation models. We must use the time now to further train people and make them suitable for the transformation and new jobs. The federal government will probably need ideas now, but these are only accompanying measures that have not yet solved the structural problem. We do damage control. But it is important to look in advance at how we can support the location so that so many jobs are not lost now.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
