Common Ground Starts with Common Figures

Felbermayr recalled that WIFO has been shaped by the social partnership since its foundation almost 100 years ago and that today it is largely supported by the social partners. Cooperation has been particularly close since the 1960s, for example through the Advisory Council for Economic and Social Affairs, established in 1963. Its guiding principle of "Versachlichung" – putting debates on an objective, factual footing – requires first agreeing on a shared set of figures. Especially in times of polarisation and alternative facts, Felbermayr sees WIFO as an independent and trustworthy source of expertise.

In international research, Austria's model of social partnership is regarded as an important reason for the country's success since 1945. While strict causal proof is difficult, Felbermayr noted, the country's development clearly supports this view: in the interwar period, per capita income was well below the Western European average; today it is well above it, and around 95 percent of the world's population is poorer than the average Austrian. Hourly productivity has increased more than fifteenfold since the early 1950s, and strike minutes have fallen by 98 percent compared with the first post-war decade. Felbermayr identified as key elements the collective agreement coverage of 95 to 98 percent of employees, the role of wage bargaining for macroeconomic stability, and Austria's internationally recognised apprenticeship system.

At the same time, Felbermayr pointed to major challenges: demographic change and the resulting need for reform in pensions, healthcare and long-term care, climate change, accelerating technological change, and a more difficult geopolitical environment for Austria's export-oriented economy. The value of well-established negotiating routines was demonstrated most recently during the COVID-19 crisis, when the short-time work scheme was negotiated within a few days and, at its peak, safeguarded more than one million jobs. Social partnership will have to change, Felbermayr said, but as a forum for finding compromise it is more important than ever. WIFO intends to continue contributing as an independent, reliable source of data, facts and analysis.