The “Botch” is probably one of the less boom industry this year: the shadow economy will increase well to 8.1 percent of the domestic economic output, which is 40.7 billion euros, the Linz economist Friedrich Schneider expects. That is for three reasons.
In general, the poor economic situation is the culprit. In particular, it is the persistent recession that leads to increasing unemployment, especially in industry and construction. More people therefore have time to warm it in instead of their previous job. Others can work less overtime, or only share anyway. Moreover, there is fairly high inflation, including strong inflation, especially with energy bills and apartment rental. As a result, not -approved work in Austria will probably increase again this year, says black working expert Friedrich Schneider. With a volume of 40.7 billion euros, the shadow economy will be 8.1 percent of the official economic output this year, which is an increase of 6.5 percent compared to the previous year.
Build economy the most affected
“The most affected are the construction sector, the trade industry, in particular repairs, as well as services such as hairdresser, cleaning lady or babysitter”. In figures: the largest share of the shadow economy by around 39 percent has the construction sector and the traditional companies in Austria. The other commercial companies and domestic related services follow with a share of 17 percent.
Schneider has already adjusted his calculations for 2024 because of the unexpected deep slump in the economy: according to this, the nominal shadow economy in the previous year has risen by 14.9 percent to EUR 38.23 billion, which was 7.8 percent of the official GDP. The increase was somewhat delayed by the abolition of the cold progression. This year, the tendency to brake must also increase due to the budget -saving measures, eg removal of subsidies such as the Remrem of the Electricity Prize. People would at least partially compensate for their loss of income, the economist explains.
There is little in Austria in the EU comparison
In the EU to Luxembourg, Austria is still the country with the least not -appropriate work. This is followed by the Netherlands and Ireland. On the other hand, there is much more in Bulgaria, Romania and Croatia, where the volume of non -declared work matters around a third of the official GDP.
The majority of the money flows back to the official economy
The biggest loser of non -declared work is the state, taxes and especially the contributions of social security for an amount of 2.0 to 3.5 billion euros per year. Tax losses would be limited, Schneider expects, because the money earned in the Busch was immediately spent in an average of 85 percent in the official economy. When purchasing building materials, installation material, etc., a clear loser is, for example, the health insurance companies because they have to bear higher costs due to additional accidents or disability for the work of the boneers without getting any contributions.
On the other hand, the income that earned in De Botte also serves a buffer for the recession, because according to the economist it compensates for part of the loss of income. Many houses would not exist without butter, because few people could pay their house without undesirable work.
If an economic policy measures to combat non -committed work, Schneider suggests the reintroduction of the Crafttsman bonus of 2,000 euros per budget and year, as well as a reduction of non -wages. That would make legal work more affordable.
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.
