Social enterprises warn of existential threats and call on the federal government to act quickly
Linz (OTS) – For decades, social enterprises have successfully supported (long-term) unemployed people through Employment, advice and qualification for re-entering the labour market in Upper Austria.
Socioeconomic enterprises, women’s vocational centres, work training and vocational training centres and specialised advisory centres are a booster for the labour market and bear a high social and economic responsibility:
- They bring people into employment and
- thereby alleviating the acute labor shortage.
- They counteract long-term unemployment and
- thus relieving the burden on social systems.
- They help ensure that formerly unemployed people pay back into the system and increase tax revenue.
Magdalena Danner from the Social Platform Upper Austria is concerned about the rising unemployment figures in Upper Austria, which are increasing faster than the national average. Danner warns: “Any lack of space in labour market policy services means fewer life chances for people on the margins of the labour market.
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Supported employment works
Die Labour market expert Gertrude Hausegger (prospect GmbH) is aware of the problems that long-term unemployment brings with it: the psychological and social consequences of unemployment and unsuccessful applications mean that people no longer have any confidence in themselves and become increasingly withdrawn. Financial losses are becoming increasingly noticeable. Professional networks that could be helpful in the job search are increasingly dwindling and existing skills quickly become irrelevant in a fast-moving world. For companies, a long period of unemployment is often a signal of reduced performance.
All of this means that this group of people can only benefit to a limited extent from high demand for workers. Social enterprises have traditionally played a central role for the AMS in supporting long-term unemployed people: the AMS places unemployed people in social enterprises when they cannot take advantage of a traditional training program or (subsidized) start working in a company or when they have already abandoned the program (several times). In these cases, it is important to specifically address the causes and/or effects of unemployment: these can be multiple problems and/or more severe health problems and/or the psychological and social consequences of unemployment.
Gertrude Hausegger explains: “Through their services, social enterprises build bridges to regular employment for unemployed people who, without targeted support, are at risk of exclusion from the labor market: Following a period of subsidized employment, around 30% to 50% of participants are back in employment – depending on the specific target group and the specific offer.
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New budget cuts are taking their toll
The financial resources for labor market policy services are mainly provided by the Public Employment Service (AMS). Social enterprises are important partners for the AMS in bringing people into sustainable employment. In 2024, 22 million euros less were already available in Upper Austria. Now further cuts of a nominal 5 million euros are threatened for 2025. In addition to the reduced funding, the social institutions were/are not compensated for collective agreement increases and inflation-related cost increases.
Magdalena Danner explains: “Just to maintain the already greatly reduced level of activity in 2024, a valorised amount of 167 million euros would be required, so in reality a total of 11 million euros will be missing in 2025. This threatens a further cut of around 7%.
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In Upper Austria there are Support facilitieswhich use their services, know-how and knowledge of regional peculiarities, etc. to support unemployed people in their sustainable integration into the primary labor market. Around 20 of these social enterprises with labor market integration services are united in the Social Platform Upper Austria. For several weeks now, the social platform has been alerted by its members to the alarming and existentially threatening effects of further cuts. The uncertainty among the sponsoring institutions is enormous and has led to the need to turn to the public as a whole. The social platform has requested an initial impact assessment of the impending cuts. The cuts will be Terminations of care staff and fewer places for job seekers in employment and for counseling, they weaken the performance of socio-economic enterprises and threaten the continued existence regional locations and advisory services (for 1/5 of the providers).
Women’s projects in danger
She:works GmbH is the contact person for professional opportunities for women in the central region of Upper Austria. In the temporary employment opportunities and temporary employment, doors are opened for women seeking work through cooperation with Upper Austrian companies in various sectors. Workplace-related qualification and comprehensive workshops, including in the area of digital skills, complement the offer. In the advice for career planning, there is a focus on green jobs and women in technology (FIT).
Susanne Steckerl, Managing Director of she:works GmbH explains: “The announced cuts are hitting us hard – especially in our women’s career centers and our socio-economic operations. It not only means that we can offer fewer women from the central Linz area the support they need to gain a long-term, qualified career, but also that we are losing colleagues.
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The women’s vocational centers have a so-called “inter-annual” contract with the AMS OÖ and were recently asked to take into account a budget cut of up to 20 percent as of July 1.
Combating long-term unemployment with sustainability
Arbeitswelt GmbH is one of four social companies in Upper Austria that are active in the circular economy. Together, they offer 300 transit jobs and 60 training jobs. The Volkshilfe OÖ company supports young people and adults in (re-)entering the world of work – from finding a suitable apprenticeship, a new job to securing an existing employment relationship. In the social-economic companies (SÖB) of the Volkshilfe, there are temporary employment opportunities from the commercial sector to storage and cleaning to the important area of the circular economy (textile sorting, electrical appliance and bicycle processing, second-hand shops and e-commerce).
Martin Zwicker, Managing Director of Volkshilfe Arbeitswelt GmbH explains: “With our socio-economic enterprises (SÖB), we have the opportunity to raise awareness of the future areas of circular economy and sustainability among people who have a particularly hard time on the job market. It is therefore doubly a shame if such austerity measures are taken in this area. Especially because the promotion of socio-economic enterprises in the circular economy and the securing of funds for SÖB are enshrined in the current government program.
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Zwicker reports that Volkshilfe Arbeitswelt had to close locations as early as 2024.
The Social Platform Upper Austria demands:
- Quick action by the Austrian federal government to increase the AMS budget
- Additional funding of the AMS OÖ budget for 2025 in the amount of at least 11 million euros
- No cuts for AMS offers with “less than one year” contracts (e.g. women’s vocational centres)
- Longer-term contract periods (at least 3 years) to increase planning security for social enterprises
- Consideration of cost increases, KV increases and indexations
Inquiries & Contact:
Mag. Josef Pürmayr, +43 699 183 58 278, puermayr@sozialplattform.at
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