The currently unstable economic situation does not stop at the advertising industry. “Although the advertising climate index is only slightly below the pre-crisis level caused by the pandemic, the uncertainties triggered by Covid-19 and the Ukraine war are having a massive impact on the advertising economy in Austria,” analyzes Michael Mrazek, Chairman of the Association for Advertising and Market Communication in the Austrian Economic Chamber ( WKÖ), the current results of the survey from April 2022.
WIFO advertising climate index for the first quarter of 2022
“The advertising climate index for the first quarter of 2022 reflects the subdued mood in the industry as a result of the increased geopolitical uncertainty,” stated Agnes Kuegler, business cycle expert at the Austrian Economic Research Institute (WIFO). “The results of the WIFO business survey in April signaled high economic momentum in the service sector, but this development in the advertising industry is evidently delayed. However, the entrepreneurial assessments of advertisers regarding future developments are optimistic.
Quarter 2022: No demand booster – but far ahead in an EU comparison
On balance, the demand index for the last three months is +4 points. This means that demand in the first quarter of 2022 was almost unchanged compared to the previous quarter, and there was no dynamic development.
As far as the demand expectations for the next 6 months are concerned, however, the advertisers remain positive: at least the balance is still clearly positive at +15 points and slightly above the long-term average before the crisis.
The demand results in a European comparison are interesting. With +20.5 points, Austria is ahead of Germany (+13.3 points) and well above the EU average of +0.3 points.
Countries like Italy (minus 45 points) are responsible for this development at the zero line.
Business situation remains difficult – order situation stable
A fifth of companies report insufficient demand as the main reason for their business being hampered. The assessments of the business situation over the last three months are negative overall at -9 points. When assessing the current business situation, the feedback of a business situation that is worse than usual for the season also predominates with a balance of -27 points.
On the other hand, the future business situation is viewed positively: at +5 points, the balance is only slightly below the comparative values of the years before the crisis. The order situation is also stable in the 1st quarter of 2022t: 58% of the companies surveyed stated that they assume that the order situation will be good or improving.
Further positive development of employment
Expectations regarding developments on the labor market are also optimistic in 2022. Despite the lack of qualified workers – already 10% of the companies stated this as the primary obstacle to their business activities in the survey – the employment expectations for 2022 remain optimistic. At +25 points, this balance is clearly in the positive range. Additional jobs will be created in the advertising and communications industry,” pulls Mrzek finally his summary.