Austria’s heavy industry and construction sectors are facing their longest crisis in goods production and demand in 20 years, economic research institute Wifo reported on Monday.

Report author Marcus Scheiblecker noted that while the previous crisis, in the early 2000s, lasted longer, the decline in production at that time was “much smaller.”

Wifo reports that the drop in output over the past six quarters marks the third-largest economic downturn after the 2008-2009 financial crisis and the Covid-19 pandemic. Over the past nine quarters, investment in residential construction has also fallen by nearly a fifth in real terms. A recovery is “not yet on the horizon,” the report added. “Leading indicators for Austria and the Eurozone suggest only modest economic momentum in the coming months.”

At present, consumer spending is offering little support to the Austrian economy. Despite substantial rises in real incomes, private consumption has been “disappointing,” the report said.

The downturn is also placing increasing pressure on the domestic labour market. Wifo indicated that job growth has slowed in recent months, with the number of vacancies reported significantly down compared to last year, while unemployment has risen.