The Austrian paper processing industry recorded a decline again in 2025. As reported by the industry association Propak, the production value fell by three percent to 2.23 billion euros. A simultaneously published study by the economic research institute EcoAustria sees the sector increasingly burdened by rising costs and weak productivity development.
Despite the difficult environment, the decline in volume was comparatively moderate at 1.2 percent. Products outside the packaging sector were particularly affected, with their production value falling by 4.4 percent. In the packaging segment, the decrease was 1.9 percent. The export quota remained high at around 80 percent, although exports declined slightly by 0.4 percent. Employment remained stable, while the number of apprentices increased by 2.6 percent.
Study sees clear disadvantages of the location
On behalf of Propak, EcoAustria examined the competitiveness of the industry in an international comparison. According to this, unit labour costs in Austria rose by around 37 percent between 2017 and 2025. In the eurozone, the increase was around 27 percent, while in Switzerland it was a mere six percent.
At the same time, labour productivity developed significantly weaker than in several Central and Eastern European countries. While it increased by around four percent in Austria since 2017, Poland recorded a gain of 25 percent, Slovakia 20 percent and Hungary 17 percent. In the Propak industry itself, productivity has been declining since 2021, according to the study.
„The study shows that Austrian companies are facing not only weaker demand but also a significantly more unfavourable development in costs and productivity. This is a serious locational disadvantage, especially for an industry with a strong export orientation.“
Monika Köppl-Turyna, Director of EcoAustria
Market shares in key export countries declining
In 2024, Germany remained Austria's most important sales market for paper processors, with exports valued at €445.9 million. This was followed by Switzerland, Poland, Hungary, and the Czech Republic. However, Austria lost market share in several key markets. In Germany, the share of Austrian suppliers between 2017 and 2024 fell from 10.3 to 8.0 percent.
According to EcoAustria, competitors from Poland, China, Italy and Spain have been able to expand their position in several markets. The study sees this as an indication of increasing cost pressure in international competition.
Packaging remains an area of innovation
The industry continues to rely on new paper and cardboard packaging solutions. These could replace plastic in various applications. According to Propak, the current price trend for plastics is improving the competitive position of paper-based packaging.
Digital applications are also gaining in importance. Mentioned are, among others, QR codes for additional product information, tamper-proof labels with holograms, and digitised ordering and release processes.
The PPWR will lead to additional burdens.
Propak critically assesses the increasing density of regulation. In particular, the European Packaging and Packaging Waste Regulation (PPWR) introduces additional documentation and reporting requirements. According to the association, numerous legal acts for practical implementation have also not yet been adopted.
For the current year, the industry does not expect a fundamental trend reversal. Propak is therefore calling for measures to strengthen the industrial location and specifically points to the development of labour costs in international comparison.
Source: Propak
