How legitimate is part time job online

Part-time takes its toll in the pension

Vienna - make part-time less attractive - with this announcement the Minister of Labor sparked a debate on part-time employment over the weekend. And that goes all over the place, because the advantages and disadvantages can be argued about - and whether the tax structure and social security system create incentives that have negative long-term effects.

"The question is whether someone works part-time because they want to, or whether they have no other choice," is how Helmut Hofer, the labor market expert at the Institute for Higher Studies (IHS), outlines the dilemma.

Part time as a trap

As much as it depends on individual living conditions, both variants have one thing in common: the lower the active salary, the lower the old-age pension and the greater the risk of old-age poverty. In that way, part-time work can be a trap.

Women sit much more frequently than men because they are responsible for the part-time quota in Austria, which is 47 percent, which is high in an international comparison. However, IHS expert Hofer puts it into perspective, it is also a question of alternatives. "Will I or will I remain unemployed if I do not take a part-time job?

Relative voluntariness

Which brings the voluntariness back into play, which in turn is relative. Because many commercial and service companies are looking for part-time workers only, but that suits many women because it is often the lack of childcare places that leads women to part-time employment. Opening times and flexibility of the childcare facilities also play a role. Before the pandemic, the retail workers, often cited as an example, did not close until 8 p.m. in cities - a time by which kindergartens are usually closed long ago.

On the other hand, part-time employment allows working time models that would never be possible with full-time. For a saleswoman or cashier from southern Burgenland, it never paid off to commute to the supermarket in Vienna for four hours a day. But if she blocks her 24-hour working week to two to three days, she saves long travel times and has the same number of hours.

State gives disincentives

However, argues Wifo economist Margit Schratzenstaller, the state also provides all sorts of incentives that have a negative long-term effect. In spite of the lowering of the entry tax rate in wage and income tax, there is the "large marginal burden": From an annual income of 11,000 euros (up to 18,000 euros), 20 percent income tax is due immediately. This is little incentive for those on low incomes to increase their weekly working hours. The situation is similar with the second progression stage, from 18,000 euros 35 percent wage tax is due.

The Wifo budget and tax expert attests that there are already disincentives at low levels, i.e. monthly incomes of up to 460.66 euros. If this limit is exceeded by just one euro, the full social security contributions are due immediately, i.e. health and pension insurance contributions (accident insurance must also be paid by marginally employed persons). This is also not a real incentive to expand gainful employment; the social framework conditions are often inadequate, especially for people with care obligations (be it child or elderly care), says Schratzenstaller.

In this sense, Kocher's announcement was made in an interview with the news magazine profile Understanding that the state should make "part-time less attractive" is what the Ministry of Labor stressed when asked by the STANDARD. The major reform of the tax and social security system, including a reduction in ancillary wage costs, was of course postponed due to the pandemic - or it is no longer planned for this legislative period

The shot against part-time could also backfire, warns IHS man Hofer, because women then stay away from the job market and stay at home.

Tax progression is not decisive

Wifo income expert Helmut Mahringer does not see the tax progression as an incentive for part-time work (because the upper income parts are subject to higher tax rates), but rather "goodies" like the single-income tax credit. The latter undoubtedly contributes to the inactivity mostly of women. However, the focal point of part-time work is the compatibility of work with care obligations. That is clear from the labor force survey. In the case of men, on the other hand, part-time is primarily based on further training and studies.

Of course, the costs also have a big impact: If the expenses for the childcare place fall and the availability and quality increase, it looks like a salary increase, because more is left net.

Reducing from full-time to part-time often leads to decline, Mahringer points out. Most part-time jobs are not in the high quality field. This is another reason why part-time phases should be kept short.


The tax and income expert of the Chamber of Labor, Dominik Bernhofer, also suggests this. He considers the incentives in the tax system to be overestimated. Conversely, one would otherwise have to increase the average tax rates for part-time workers in order to make part-time less attractive. Or cancel the negative tax. That could not be expedient. Bernhofer also considers the availability of affordable care facilities for children as well as for the elderly and those in need of care to be much more effective. (Luise Ungerboeck, March 16, 2021)