Austria to reward businesses for employing locals

Austria to reward businesses for employing locals
Austria's coalition government has approved new labor regulations providing local job applicants an advantage over immigrants. The measure is aimed at halting mounting unemployment.

Immigration into Austria has been rising, increasing its labor pool mostly with Eastern Europeans due to significantly higher wages and social benefits.

Under a harmonized EU measure, unemployment in Austria is still relatively low at 5.7 percent but keeps rising as the country experiences slower growth.

According to the new plans, Austrian citizens will be given priority for new jobs along with EU nationals already resident in Austria over newcomers from outside the country.

“This has nothing to do with hostility toward foreigners. I do not care about the birth certificate, but I do want to solve a problem we are dealing with in Austria,” Chancellor Christian Kern and chairman of the Social Democratic Party of Austria said in a Facebook message.

The new regulations will allow the government to halve non-wage labor costs for three years starting from July for companies which create new jobs and hire locals changing jobs or registered as unemployed.

According to the government, the reform will cost €2 billion ($2.1 billion) and will help to create 160,000 new jobs.

However, the plan, which could undermine the bloc’s principle of free movement of people, might be opposed by Brussels. The EU executive won’t comment on legislation it has not yet examined, according to a European Commission spokesman, as quoted by Reuters.

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Meanwhile, Kern said he was confident of getting the green light from Brussels. Austria has to find creative solutions to apply European regulations to curb unemployment, he said.