In Austria, the Federation of Austrian Industries warned last week that Austrian businesses should prepare for a recession sometime this year, and that economic growth will not return until next spring.

Federation secretary general Christoph Neumayer warned in a press conference that “from a macroeconomic point of view, the signs to date point to a prolonged phase of economic stagnation,” according to media reports. He added businesses should prepare themselves for a recession, “with a view to the winter half-year (October to March).”

Neumayer advised using targeted initiatives to draw in private sector investment, such as was used during the Covid-19 pandemic by the Austrian government.

Christian Helmenstein, the federation’s chief economist, noted that every economic indicator right now looks pessimistic, as he cautioned that, “the situation will initially deteriorate further before, at best, it will pick up again next spring.”

The comments were delivered at a press conference where the Federation of Austrian Industries presented a new survey it conducted of over 430 companies, looking at their views of the current environment and gauging their expectations.

The survey produced what is called an “economic barometer,” which is determined as a weighted average of positive and negative assessments of the current economic and business environment, as well as its potential for development in the next six months. In the current survey, it has dropped to a reading of zero points, compared to its previous reading of positive 10.7.

Last year, the war in Ukraine combined with economic sanctions levied against energy supplier Russia to produce an energy crisis in Europe. That led to a period of unprecedented inflation, which caused central banks to tighten monetary policy. Combined, all of those factors have contributed to slowing economies, and reduced business opportunities.