Suche
Mein Konto
Public service reaches historic conclusion: 310 million euros saved!
On October 7, 2025, a historic agreement was negotiated for the public service in Austria, which regulates savings and wage increases.
Public service reaches historic conclusion: 310 million euros saved!
On October 7, 2025, a historic graduation in the Austrian public service was announced. For the first time in history, an existing agreement was renegotiated by State Secretary Alexander Pröll was classified as significant. The financial relief is proving to be significant, with savings of over 310 million euros in 2026.
The negotiated contract provides for an average inflation compensation of 1.5% over the next three years. The negotiations were perceived as intensive and appreciative, which was also reflected by Finance Minister Markus Marterbauer was emphasized, who praised the constructive cooperation. NEOS negotiator Martina von Künsberg Sarre saw this conclusion as an important signal of budget relief.
Specification of wage adjustments
The important adjustments to the new wage agreement are obvious. There will be no wage increase between January 1, 2026 and June 30, 2026. From July 1, 2026, 3.3% is planned, followed by two further increases of 1% each in the period from August 1, 2027 to August 31, 2028 and from September 1, 2028 to December 31, 2028. The aim of these measures is to reduce inflation to a value of 2% and to promote sustainable economic growth of 1%.
These negotiations come at a time when the general economic situation in Austria is characterized by a “wage-price spiral”. Loud DGB prices rise due to high energy prices as well as food and raw material prices. Companies often use their market and pricing power to arbitrarily increase prices, with high corporate profits contributing to inflation.
Public service as a driver of inflation
The public service in Austria in particular has contributed to inflation in recent years. High wage settlements in the public sector led to rising production costs, and consumer prices rose by 8.6% in 2022, influenced by the energy crisis and supply shortages. Those familiar with the matter note that wage increases in 2021 of around 1.5% in the public sector lagged behind inflation and thus led to a loss of purchasing power. A record 7.3% increase in public sector salaries was recorded in 2023.
In addition, wages rose in many private sectors, which was intended to secure purchasing power, but at the same time increased price pressure. For example, prices in restaurants and hotels rose by 15.8% in 2023. These price increases are seen as a factor in the worrying “price spiral”, and despite higher public sector salaries, which are ultimately financed by taxpayers, this creates a burden for consumers.
Overall, it is clear that the interaction between wages and prices must be understood as a central element of the Austrian inflation situation. In 2024, inflation was expected to be an estimated 3-4%, which is higher than the European average. The development of wages and prices remains a crucial topic in the focus of social and economic debates in Austria.