COMMISSION STAFF WORKING DOCUMENT 2024 Country Report - Austria Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Austria
Date: 2024-06-19
Institutions: European Commission, Secretariat-General
Subjects: Austria, budget policy, economic policy, economic recovery, economic reform, employment policy, energy diversification, labour market, social policy, stability pact

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 19.6.2024  SWD(2024) 620 final  COMMISSION STAFF WORKING DOCUMENT 2024 Country Report - Austria Accompanying the document Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Austria {COM(2024) 620 final} - {SWD(2024) 600 final}  
 
 
 
 
 
 
 
 
 
 
 
 
ECONOMIC AND EMPLOYMENT SNAPSHOT 

Austria’s economy is set to recover 
only gradually  

reduced 

Austria’s economy contracted by 0.8% in 
2023  and  it  is  set  to  recover  only 
gradually (1).  The  main  drivers  of 
the 
contraction  were  weak  consumer  spending,  a 
low  level  of  investment  and  weak  external 
demand.  The  comparatively  high 
inflation 
eroded  the  purchasing  power  of  households 
spending  appetite,  while 
and 
monetary tightening and the uncertain outlook 
had  a  negative 
investment. 
Economic  recovery  is  projected  to  be  gradual, 
with  growth  increasing  to  0.3%  in  2024  and 
picking  up  to  1.6% 
in  2025.  Consumer 
spending is expected to be the main driver of 
levels  of 
growth,  underpinned  by  stable 
employment and strong real wage growth due 
to  the  collective  wage  agreements  concluded 
at the end of 2023. Investment is projected to 
remain  a  drag  on  growth  in  2024  due  to  a 
struggling  construction  sector  and  high 
interest rates.  

impact  on 

Inflation was among the highest in the EU 
in  2023  but  it  is  now  set  to  decline.  It  is 
expected  to  decrease  from  7.7%  in  2023  to 
3.6%  in  2024  and  2.8%  in  2025.  Services 
superseded energy prices as the main driver of 
inflation  in  2023  and  are  set  to  remain  the 
main  driver  in  the  coming  years.  The  strong 
contribution of services to overall inflation can 
be  explained  by  the  robust  growth  in  wages, 
which  impacted  labour-intensive  sectors,  and 
by the high weighting attributed to services in 
the  inflation  index  (third  highest  weighting  in 
the EU) (2).  

(1)  The cut-off date for the data used to prepare the 27 

Country Reports was 15 May 2024. 

(2)  Eurostat prc_hicp_inw. 

In  2023,  rising  interest  rates  led  to  a 
substantial  decrease  in  activity  in  the 
construction  sector.  The  housing  market 
cooled  down  after  a  period  of  strong  price 
increases.  New  housing  loans  fell  by  62% 
from the second quarter in 2022 to the second 
quarter in 2023 (3) (see Annex 18). Investment 
activity in the construction sector continued to 
decline. To address this, in February 2024 the 
Austrian  government  announced  a  three-year 
construction  support  package  of  EUR  1 billion 
(0.2% of GDP) for the renovation, maintenance 
and  construction  of  residential  buildings.  As 
part of the package a reform to allow federal 
states  (Länder)  to  introduce  taxes  on  vacant 
dwellings was adopted.  

Graph 1.1: General government budget balance 
and gross debt 

Source: European Commission Spring Forecast 2024 

taken 

support  measures 

in 
Fiscal 
response  to  the  COVID-19  pandemic  and 
the  energy  crisis  were  gradually  phased 
out,  but  deficits  declined  only  slowly.  In 
2023,  the  deficit  decreased  to  2.7%,  from 
3.3% in 2022. An increase in the budget deficit 
to 3.1% of GDP is expected in 2024, before it 
is  set  to  decrease  again  in  2025.  This  is  a 
result  of  new  policy  measures, 
including 
additional  expenditure  on  defence,  climate 
care  and  healthcare. 
action, 

long-term 

(3)  OeNB (2023) – Economic Outlook for Austria.  

2 

-9.00-8.00-7.00-6.00-5.00-4.00-3.00-2.00-1.000.001.005055606570758085909510016171819202122232425Gross debt (lhs)Budget balance (rhs)forecast% of GDP 
 
 
  
 
Revenue  growth  is  set  to  be  weaker  than  in 
the past following the introduction of the eco-
social  tax  reform  and  the  abolishment  of  the 
tax  bracket  creep.  After  a  sharp  rise  in  the 
public  debt-to-GDP  ratio,  by  12.4  pps  in  the 
context  of  the  COVID-19  pandemic,  the  debt 
burden  is  gradually  decreasing  due  to  strong 
nominal  GDP  growth.  Government  debt  fell 
from  83%  debt-to-GDP  ratio  in  2020  to  a 
projected  77.7% 
in  2024.  However,  pre-
pandemic  debt  ratio  levels  are  unlikely  to  be 
reached in the foreseeable future.  

Demographic ageing and its related costs 
pose  a  substantial  challenge  for  public 
finances.  As  the  old-age dependency  ratio (4) 
is projected to increase from 29.8% in 2023 to 
46.4% 
in  2050,  ageing-related  costs  are 
projected  to  increase  from  27.7%  of  GDP  in 
2022  to  29.5%  in  2050 (5).  These  trends  will 
pose  a  burden  on  public  finances,  despite 
potential  migration  and 
the 
employment 
rates  of  women  and  older 
workers.  This  is  particularly  the  case  for  the 
long-term  care 
pension,  healthcare  and 
systems,  which  will 
further 
require 
adjustments  to  ensure  efficiency,  adequacy 
and sustainability in the long run.  

rises 

in 

The labour market proved resilient in the 
face  of  the  economic  slowdown  in  2023. 
improved  steadily 
rate 
The  employment 
throughout  2023  and  stood  at  77.3%  in  Q4-
2023.  Unemployment  increased  slightly,  but 
the  negative  impact  of  the  overall  weak 
economic  performance  can  still be  considered 
moderate. The employment rate is expected to 
develop positively in 2024, due to the increase 
in the number of women and older people who 
is 
are  working.  The  unemployment 
expected  to  stabilise  at  around  5.3%  in  2024 
and may start to fall again in 2025.  

rate 

Austria's  green  budgeting  instruments, 
such as climate-related spending reviews 
and  the  promotion  of  green  finance,  are 

considered  a  best  practice  in  the  EU (6). 
The  strategic  approach  to  integrating  climate 
and  environmental  considerations  into  the 
budgeting process steers the path towards an 
increased  impact  orientation.  Austria  is  also 
piloting  the  development  of  impact  indicators 
for its green budgeting approach.  

financial  sector 
In  2023,  Austria's 
remained  robust  in  spite  of  a  major 
insolvency  in  the  real  estate  sector  and 
persistent  exposure  to  Russia.  Despite 
weak  economic  growth  and  high inflation,  the 
non-performing  loan  ratio  declined  slightly. 
The  profitability  of  the  banking  sector  was 
strong due to higher interest rates. Issues that 
merit  closer  attention  include  the  continued 
exposure  to  Russia,  where  Austria’s  second 
largest bank remains active. The insolvency of 
Signa,  Austria's  largest  privately-owned  real 
estate  company,  illustrates  the  risks  in  the 
commercial 
amid 
headwinds  in  both  borrowers’  credit  ratings 
and property valuations (Annex 18).  

real-estate 

segment 

Slow diversification away from 
Russian gas hinders the green 
transition and energy security 

expand 

capacity 

transport 

Despite  some  diversification,  Austria  is 
still  dependent  on  Russian  gas.  Imports 
from  Russia  dominated  the  gas  supply  in 
2023,  in  particular  during the  heating  season. 
To 
from 
neighbouring  countries  such  as  Germany  the 
government  announced  targeted  investments 
to  upgrade  the  gas  pipeline  infrastructure. 
Without  a  clear  strategy  to  diversify  away 
from  Russian  gas,  Austria’s  energy  security 
remains  vulnerable.  This  is  particularly  the 
case considering that the share of natural gas 
in the energy mix is 21% (7). Installed capacity 
for renewable energy increased by 6% in 2022 
(by  10%  in  the  EU),  also  benefiting  from 

(4)  Population 65 years or over to population 15 to 64 

(6)  European Commission (2023), Green Budgeting in the 

years. 

EU. 

(5)  European Commission (2024) – 2024 Ageing Report.  

(7)  Eurostat (2022), Simplified Energy Balances. 

3 

 
 
 
measures  under  Austria’s 
resilience plan.  

recovery  and 

to 

Austria  has  the  ambitious  objective  of 
becoming  climate  neutral  by  2040. 
Measures 
reduce  emissions  are 
starting  to  show  results  but  are  not  yet 
sufficient  to  meet  the  2030  climate  and 
energy  targets.  Greenhouse  gas  emissions 
outside  the  EU  Emissions  Trading  System 
declined by 5.0% in 2022 compared  to 2021. 
Current  policies (adopted at  the end  of  2021) 
leave  a  gap  of  21  pps  to  Austria’s  effort 
sharing target of 48 % by 2030 compared to 
2005  levels  (see  Annex  6).  Since  then,  some 
additional  measures  have  been  taken  and 
others are under discussion as part the update 
of its national energy and climate plan (NECP). 
Austria still needs to submit its updated NECP 
due in June 2024, setting out how it will close 
this gap. 

The availability of skilled labour 
and growth financing is critical for 
improving productivity and 
competitiveness 

in 

loss 

fall 

short-term 

cost 
The 
competitiveness  is  expected  to  subside. 
Nominal unit labour costs increased by 9.7% in 
2023 and are expected to rise further in 2024 
as  strong  nominal  wage  growth  compensates 
workers  for  high  inflation.  This  rise  is  above 
the  euro  area  average  and  contributed  to  a 
short-term 
in  cost  competitiveness.  
However,  real  exports  kept  rising  (+0.3%)  in 
2023 and Austria preserved its export market 
share  in  spite  of  weak  demand  in  its  main 
export  markets (8). 
that 
companies were able to absorb increasing unit 
labour  costs  by  reducing  profit  margins  as 
they  had  previously  benefitted  from  price 
hikes (9).  The  strongly 
tourism 
sector  seems  to  be  withstanding  the  rising 

recovering 

indicates 

This 

(8)  FIW (2024) – FIW Jahresgutachten Die österreichische 

Außenwirtschaft 2024. 

(9)  WiFO (2023) – WIFO KONJUNKTURPROGNOSE 

04/2023. 

4 

cost pressures relatively well, due to low price 
sensitivity.  As  inflation  falls  and  growth  picks 
up  gradually,  overall  cost  competitiveness  is 
set to recover. 

Graph 1.2: Vacancy rate in EU Member States 
Q4-2023 

(1) Vacancies in industry construction and services 
(except activities of households as employers and 
extraterritorial organisations and bodies 
Source: Eurostat 

Labour  and  skills  shortages  are  among 
the  highest  in  the  EU  and  are  impacting 
growth,  investment  and  innovation.  The 
job  vacancy  rate  is  still  one  of  the  highest  in 
the  EU  (see  Graph  1.2.),  which  is  mainly 
caused by demographic changes, restructuring 
of industries, increasing demand for new skills 
in light of the green and digital transitions and 
the  current  skills  mismatch.  The  gap  between 
vacancies  and  labour  supply  is  also  driven  by 
regional mismatches. Tapping into the unused 
labour  market  potential,  in  particular  through 
upskilling  and  reskilling,  can  help  to  address 
labour  shortages  and  to  reach  the  2030 
targets on employment and skills (Annex 8). 

to 

In  2022,  Austria’s 

The  low  level  of  business  dynamism  and 
limited  access 
risk  capital  are 
innovation  and  productivity 
hindering 
gains. 
research  and 
development intensity was the third highest in 
the EU (3.2% of GDP). However, the high level 
of  public  and  private  investment  in  research 
and  innovation  does  not  fully  translate  into 
higher  innovation  outputs,  owing  to  the  low 

00.511.522.533.544.5BGROESPLIESKPTHRLUEEELFIITLTSESIHULVEU27CYMTCZDEATNLBE% of vacant posts (total posts = number of occupied posts+ number of job vacancies)no data available for DK & FR 
 
  
level of business creation and the lack of risk 
capital  needed  by  fast-growing  enterprises 
when scaling up.  

the 

While Austria performs well on almost all 
indicators, 
Scoreboard 
underpinning  the  European  Pillar  of 
Social Rights points to challenges in early 
childhood  education  and  care  (ECEC). 

Social 

Fewer  than  one  in  four  of  children  under  3 
years  of  age  are  enrolled  in  ECEC.  The 
insufficient  provision  of  quality  ECEC  facilities 
forms a major barrier for women, in particular 
mothers  of  young  children,  to  work  full-time, 
with  their  labour  market  potential  remaining 
underused.  While  significant  investments  are 
envisaged to increase the availability of ECEC, 
their impact remains to be seen (see Annex 14 
and Chapter 3). 

Box 1: 

Austria’s competitiveness in brief 

Austria’s  competitiveness  deteriorated  slightly  in  2023,  owing  to  rising  unit 
labour costs. On the other hand, in the last 5 years it benefited from a high level of 
public and private investment (business investment was 15.7% of GDP in 2022, 2 pps 
above the EU average). As a strong innovator, Austria makes significant investments in 
research  and  development  (3.2%  of  GDP  in  2022)  and  performs  well  in  the  areas  of 
digitalisation, green technology, quality of infrastructure and integration in global supply 
chains.  The  Austrian  recovery  and  resilience  plan  and  EU  cohesion  policy  programmes 
are  expected  to  further  foster  long-term  competitiveness  by  investing  in  energy  and 
industrial  transformation,  strategic  innovations  and  in  people,  as  well  as  in  actions  to 
improve the business environment. 

However, competitiveness challenges remain: 

•  skills  shortages  and  skills  mismatches  are  barriers  to  business  activity, 
becoming  a  key  challenge  also  due  to  the  ageing  of  population  and  the 
educational outcomes of people from a disadvantaged background; 

• 

the  low  level  of  business  dynamism  and limited  access to risk  capital 
impair  the  effectiveness  of  Austria’s  innovation  system  and  hinder  growth  of 
young innovative enterprises. 

Box 2: 

UN Sustainable Development Goals (SDGs) 

Austria performs well or very well in all the SDGs related to competitiveness 
and productivity (SDG 4, 8, 9).  Austria’s high score on quality education (SDG 4) is 
due to its relatively good performance in digital skills. Sustainable economic growth and 
employment  indicators  (SDG  8)  are  above  the  EU  average,  in  particular  because 
Austria’s  labour  market  is  characterised  by  low  unemployment  and  relatively  high 
wages,  and  the  employment  rate  is  above  the  EU  average.  Austria’s  score  on  SDG  9 
related  to  innovation,  industry  and  sustainable  infrastructure  is  well  above  the  EU 
average,  in  particular  because  of  its  spending  on  R&D,  which  is  among  the  highest in 
the EU (Annex 1). 

Of  the  17  indicators,  those  related  to  4  SDGs  remain  below  the  EU  average. 
These  relate  to  fairness  (SDG  10),  some  aspects  of  energy  and  environmental 
sustainability (SDG 2, 7) and partnership for the goals (SDG 17). 

5 

 
 
 
 
IMPLEMENTATION OF KEY REFORMS AND 
INVESTMENTS USING EU INSTRUMENTS 

Funding from the Recovery and Resilience 
Facility (RRF) and cohesion policy funding 
is  mutually  reinforcing  Austria's  efforts 
to  boost  its  competitiveness  and  foster 
sustainable growth. Under Austria's recovery 
and  resilience  plan  (RRP),  following  the  first 
the  Commission  has 
payment 
request, 
disbursed  EUR  1.19  billion, 
representing 
around 30% of Austria’s allocation. During the 
2014-2020  programming  period  of 
the 
cohesion  policy  funds,  EUR  1.3  billion  was 
available  to  Austria  (see  Annex  4),  with  EUR 
1.12  billion  paid  out,  while  the  current  2021-
2027 financial envelope amounts to over EUR 
1.1 billion.  

Cohesion  policy  funding  helps  tackle 
Austria’s  growth  and  competitiveness 
challenges  and  reduce  the  country’s 
territorial  and  social  disparities.  During 
the 2014-2020 cohesion programming period, 
support  focused  on  research  and  innovation, 
energy 
energy, 
education,  and  skills.  In  the  current  2021-
2027 programming period, cohesion policy will 
further  support  Austria’s  competitiveness,  its 
green  transition  and  social  cohesion,  and  the 
improvement of living and working conditions. 

renewable 

efficiency, 

Accelerating the green transition  

has 

Austria 

Under  its  recovery  and  resilience  plan 
(RRP), 
implemented 
significant  policy  measures  that  are 
expected  to  improve  its  competitiveness. 
In  particular,  the  RRP  includes  major  reforms 
such as the eco-social tax reform and reforms 
reducing  the  burden  for  small  businesses, 
updating  the  pension  system  as  well  as 
in 
investments 
research, 
digitalisation, 
the  circular  economy  and 
renewable  energy  sources.  Austria  has  also 
made  substantial  investments  in  sustainable 
mobility,  the  decarbonisation  of  industry  and 
heating systems, healthcare and education. 

the  areas  of 

The implementation of Austria’s recovery 
and resilience plan is underway, however 
timely  completion  requires 
increased 
efforts.  Austria  has  submitted  one  payment 
request,  corresponding  to  44  milestones  and 
targets in the plan  and  resulting  in  an  overall 
disbursement  of  EUR  700  million  on  20  April 
2023.  Emerging delays in  the  implementation 
of the RRP measures could put in jeopardy the 
timely  and  effective  implementation  of  the 
plan.  Looking  ahead  at  the  second  payment 
request,  a  number  of  reforms  still  have  to be 
adopted. 

6 

to 

in 

change 

climate 

combat 

reducing 

greenhouse 

The adoption of the eco-social tax reform 
under  the  RRP  constitutes  an  important 
gas 
step 
emissions and a welcome shift in the tax 
mix.  This  reform,  adopted  in  February  2022, 
by 
aims 
contributing  to  the  reduction  of  greenhouse 
gas  emissions  to  net  zero  by  2040.  For  this 
purpose, the reform introduced a national CO2 
price  which  should  incentivise  more  climate-
friendly consumption. It also helps to diversify 
the tax base and to shift the tax burden away 
from  labour-related  taxation  to  more  growth-
friendly  and  inclusive  taxes.  To  cushion  the 
financial  burden  of  carbon 
taxation  on 
households,  a  regional  climate  bonus  is  paid 
out to all residents once per year. Tax relief for 
for 
people  and  businesses 
example, a lower income tax rate and a higher 
‘Family  Bonus  Plus’,  helps  strengthen  social 
inclusion. 

comprising, 

Austria  introduced  reforms  to  speed  up 
the deployment of renewable energy.  The 
Renewable  Energy  Expansion  Law  adopted  in 
2021 lays down new framework conditions for 
supporting 
from 
renewable  sources.  Together  with  the  revision 

generation 

electricity 

 
 
of  the  Environmental  Impact  Assessment  Act, 
this  is  an  important  step  in  meeting  the 
country’s target of 100% renewable electricity 
by 2030. The Renewable Heating Law, adopted 
in 2023, focuses on reducing the use of fossil 
sources  for  heating  purposes.  RRF  funding  is 
also  used  to  replace  oil  and  gas  heating 
systems,  and  for  solar  rooftop  photovoltaic 
installations,  as  well  as  storage  systems.  The 
RRP  also  supports  Austria's  participation  in 
Important  Projects  of  Common  European 
Interest  in  the  field  of  hydrogen  with  five 
projects. 

energy 

improving 

businesses 

support 
in 

Cohesion  policy  and  the  RRP  finance 
complementary 
efficiency 
measures  to  help  Austria  achieve  its 
ambitious  objective  of  climate  neutrality 
by  2040.  The  Austrian  European  Regional 
Development  Fund  (ERDF)  and  Just  Transition 
Fund (JTF) 
and 
municipalities 
their  energy 
efficiency. At the same time, the RRP finances 
large  business  and 
major  projects 
installations  covered  by  the  EU  Emissions 
Trading  System,  for  example  to  switch  to 
renewable  energy  sources.  Cohesion  policy 
funding  for  energy  efficiency  measures  in 
businesses  and  municipal  infrastructures  is 
estimated to reduce greenhouse gas emissions 
CO2 
by 
nearly 
equivalent/year. 

270 000 

tonnes 

of 

in 

ticket 

season 

flat-rate 

Austria is taking important steps towards 
sustainable mobility through reforms and 
investments  in  railways  and  emission-
free  buses  and  utility  vehicles.  As  part  of 
its  RRP,  Austria  has  announced  the  Mobility 
Masterplan  2030  and  introduced  the  ‘climate 
ticket’,  a 
that 
encourages  people  to  use  public  transport. 
Financing  from  the  Connecting  Europe  Facility 
is  complemented  by  funds  from  the  RRF  to 
complete part of the Koralmbahn railway line, 
including  the  electrification  of  some  feeder 
lines.  Moreover,  579  zero-emission  buses  and 
167  commercial  vehicles,  as  well  as  charging 
infrastructure,  are  to  be  financed  through  the 
RRF  to  help  accelerate  the  decarbonisation  of 
road  transport,  which  is  the  sector  most 
difficult  to  abate,  and  accounting  for  28%  of 
Austria’s total greenhouse gas emissions. 

Unlocking funds for the digital 
transition, research and innovation 

is 

to 

Austria is using funding from the RRP and 
cohesion  policy  to  further  strengthen 
research  and  the  economic  exploitation 
of  research  in  high-tech  sectors.  RRF 
funding 
research 
dedicated 
infrastructures  and  research  collaborations  in 
the  area  of  quantum  sciences  and  the 
establishment  of  an  Austrian  centre  of 
precision  medicine.  In  addition,  ERDF  and  JTF 
funds are being used to support research and 
innovation  projects,  and  for  equipment  and 
incubation  centres  that,  among  other  things, 
enable  a  transition  to  low-  and  zero-emission 
technologies.  To  help  foster  Austria’s  long-
term  competitiveness,  the  RRP  is  supporting 
five  major  projects,  as  part  of  Important 
Projects  of  Common  European  Interest,  to 
develop highly innovative products in the fields 
of  semiconductors,  advanced  processors, 
power electronics and sensors.   

related 

With  the  reforms  in  the  RRP,  Austria  is 
to 
challenges 
addressing 
connectivity  to  improve  competitiveness 
and  social  cohesion.  The  reforms  advance 
the digital transformation in a variety of areas, 
including  connectivity,  public  administration 
and  education.  For  example,  the  amendment 
of the Business Service Portal Act has reduced 
bureaucracy  for  businesses  and  the  public.  In 
addition,  the  government  successfully  began 
to 
implement  projects  to  support  digital 
infrastructure  through  the  digitalisation  fund 
for  public  administration  and  the  roll-out  of 
gigabyte-capable  networks.    With  the  support 
to  at  least  7 000  companies,  RRP-funded 
investments  aim  to  counter  the  weak  uptake 
of  digital  technologies  and  digital  business 
models among smaller companies.  

Investing in people for growth, 
fairness and social inclusion 

With  a  combination  of  reforms  and 
investments, Austria aims to improve the 

7 

 
Box 3: 

Combined action for greater impact of EU funds 

To  boost  economic  growth  and  maximise  the  impact  of  EU  funding,  Austria’s  RRP 
includes  reforms  that  support  investments  under  other  EU  instruments,  creating 
significant synergies and complementarities between the various funds. For example, a 
reform  implemented  as  part  of  the  RRP  which  aims  to  facilitate  the  early  stages  of 
start-ups,  including  by  introducing  a  new  legal  form  for  start-ups  and  by  examining 
further  tax  incentives,  is  complemented  by  ERDF  support  for  start-up  services  in  the 
regions  such  as  coaching  for  knowledge-intensive  start-ups  and  the  provision  of 
facilities to incubate new companies.  

introducing 
improves 

skills  of  unemployed  and 
low-skilled 
people  to  help  alleviate  growing  labour 
the 
reform 
shortages.  The 
education  bonus 
the 
scheme 
framework  conditions  for  unemployed  people 
to  participate  in  training  measures.  With  RRF 
funds,  it  is  envisaged  that  at  least  94 000 
people  will  benefit  from  re-skilling  and  up-
skilling  measures  in  Austria.  To  help  tackle 
labour  shortages  in  the  area  of  the  green 
transition,  the  JTF  complements  the  RRP 
measures  by  supporting  the  development  of 
includes  an  eco-tech 
green  skills.  This 
environmental 
academy; 
sustainability,  photovoltaic  technology,  and  e-
mobility; targeted career guidance and support 
for  employers  on  green  skills.  In  the  field  of 
social  inclusion,  funding  of  EUR  114  million 
from  the  European  Social  Fund  Plus  will  help 
support  active  labour  market  integration  and 
promote  active  inclusion,  including  of  persons 
with  disabilities.  Closing  gaps  in  skills  and 
labour shortages will help to increase Austria’s 
competitiveness.  

training 

on 

cohesion 

is 
Austria’s 

Mutually  reinforcing  support  from  RRF 
improving 
and 
funds 
educational 
RRP 
outcomes. 
contains  significant  reforms  and  investments 
to  increase  the  number  of  places  in  early 
childhood  education  and  improve  access  to 
education,  including  by  setting  criteria  to 
define the socio-economic baseline of schools 
to  guide  the  allocation  of  human  resources. 
These  targeted  reforms  and  investments  are 
complemented  by  support  from  the  European 
improving 
Social  Fund  Plus,  aiming  at 
educational  outcomes  to  prevent  early  school 
leaving, 
in  particular  of  disadvantaged 
students.  Under  the  RRP,  around  160 000 

8 

digital devices have been provided to pupils in 
the lower secondary level to ensure access to 
digital  education  under  fair  and  appropriate 
conditions,  without 
socio-economic 
background  interfering.  Improving  educational 
outcomes supports Austria’s competitiveness.  

their 

reforms 

Complementing 

A  series  of  measures  in  the  RRP  address 
the  challenges  faced  by  the  health 
system. 
to 
strengthen primary health care and prevention, 
the  RRP  finances  the  increased  provision  of 
primary  healthcare  units,  with  the  aim  of 
shifting  the  weight  from  hospital  care.  This 
also  includes  investments  to  step  up  the 
digitalisation  of  the  health  sector  and  to 
increase  social  fairness  by  widening  access 
and  digitalising  the  parent-child  pass  also  by 
improving 
socially 
‘early 
disadvantaged pregnant women.  

aid’ 

for 

efficient 

Spending reviews are an essential way of 
identifying  potential  savings  in  public 
finances,  thereby  making  the  public 
administration  more 
and 
effective. The reform of the spending review 
process, as included in the RRP and which has 
been  ongoing  since  2021,  consists  of  five 
modules that build on each other and focus on 
‘digital 
‘green 
transformation’. Spending reviews help assess 
public expenditure in  different  areas,  in  terms 
of  whether  they  are  achieving  the  desired 
results,  where  useful  starting  points  for  cuts 
and  savings  may  be  found,  and  where 
expenditure could or should be restructured to 
better  exploit  the  results  of  synergies.  The 
resulting  proposals  may  be  included  in  the 
budget process. 

transformation’ 

and 

 
 
FURTHER PRIORITIES AHEAD 

Austria  faces  challenges  related  to  the 
sustainability  and  efficiency  of  public 
finances, 
fair  and  growth-enhancing 
taxes,  diversification  of  energy  imports, 
business dynamism, and labour and skills 
shortages. Tackling these challenges will help 
increase  Austria’s  long-term  competitiveness 
and ensure that its economy remains resilient. 
It  will  also  help  make  further  progress  in 
achieving  the  UN  Sustainable  Development 
Goals.  

and  Russia’s  war  of  aggression  against 
Ukraine. 

Graph 3.1: Total age-related expenditure – 
baseline projections for 2030 as percentage 
of GDP 

is 

important  that  the  challenges 
It 
identified are addressed both at national 
and  regional 
regional 
disparities.   

reduce 

level 

to 

The sustainability of public 
finances remains a priority 

Rising spending needs will increase fiscal 
pressure  over  time.    Public  finances  will 
continue  to  be  affected  by  the  ageing  of  the 
population.  It  is  currently  estimated  that  by 
2030  Austria  will  have  the  second  highest 
age-related  costs  at  29.1%  of  GDP  in  the  EU 
(see Graph 3.1) (10). The ageing population will 
increase  fiscal  pressures  related  to  pensions, 
healthcare  and  long-term  care.  This  calls  for 
further  measures  to  ensure  the  long-term 
sustainability  of  the  pension  system,  the 
efficiency  of  healthcare  and  the  sustainability 
and  access  to  of  long-term  care,  both  at 
federal  and  regional  government  level  (see 
below).  Such  measures  are  needed  to  contain 
Austria’s  public  debt  ratio,  which  have  been 
heavily  affected  by  the  COVID-19  pandemic 

(10)  The 2024 Ageing Report: Economic and Budgetary 
Projections for the EU Member States presents 
projections showing total age-related expenditure in 
2030.  

Source: European Commission 2024 Ageing Report 

system 

of 
The 
complex 
transfers  between 
intergovernmental 
federal  and  sub-national  levels  presents 
a  challenge  to  ensuring  efficient  public 
spending. Almost one third of all tax revenues 
are  transferred  from  the  federal  government 
to different sub-national levels, using a variety 
of  allocation  mechanisms (11).  Länder  and 
municipalities perform many vital public tasks, 
such as healthcare, childcare or investment in 
public  transport,  but  they  have  limited  tax 
autonomy  and  depend  on  a  complex  transfer 
system.  Many  of  these  services  are  expected 
to  experience  increasing  cost  pressures  as  a 
result  of  demographic  changes  and 
the 
investments  needed  for  the  green  transition. 
The  financial  equalisation  scheme  (Austria’s 

(11)  Mitterer & Pichler (2023). 

9 

051015202530IEHUMTLVLTEELUROBGHRCZPLELNLSKCYSISEPTEUDEESDKFIITBEATFR20302022 
 
 
  
 
and 

climate 

multiannual fiscal framework) for 2024-2028, 
concluded 
in  November  2023,  allocated 
additional spending in key areas. In particular, 
the  ‘Fund  for  the  future’,  which  is  linked  to 
quantitative  and  qualitative  targets,  provides 
additional  funding  for  childcare,  long-term 
care  housing  and  renovation  as  well  as 
environmental 
protection 
measures. However, ensuring  compliance  with 
the  adopted  targets  is  only  foreseen  through 
soft  policy  monitoring 
its 
national  recovery  and  resilience  plan  (RRP), 
Austria  committed  to  carrying  out  a  series  of 
spending 
the 
recommendations from these reviews will help 
to  minimise  inefficient  or  climate-unfriendly 
public  spending.  Further  steps,  such  as  a 
reform  of  the  property  tax  system,  could 
strengthen 
tax  autonomy  and 
reinforce the overall tax system. 

Follow  up  on 

instruments. 

reviews. 

regional 

In 

country,  with  a 

The  tax  system  continues  to  rely  heavily 
on  labour  income  and  consumption,  with 
property and environmental taxes playing 
a  secondary  role  in  the  tax  mix.  Despite 
multiple  tax  reforms,  Austria  remains  a  high-
tax 
ratio 
significantly above EU average (see Annex 19). 
Since  2023,  personal  income  tax  brackets 
have been indexed to inflation (12) (see Box 4), 
preventing a further increase in the tax wedge 
through bracket creep (13). Still, the tax wedge 
in  Austria  remains  among  the  highest  in  the 
EU (14), hindering job creation and participation 

tax-to-GDP 

(12)  As of 2023, the tax brackets of the personal income tax 
(except for incomes over EUR 1 million) are annually 
indexed by two thirds of inflation, whereas the 
remaining third is subject to discretionary relief 
measures (further reduction on income taxes, support 
for people who use public transport, etc) adopted by the 
government each year. 

(13)  Bracket creep happens when inflation pushes earners 
into higher tax brackets, increasing their effective tax 
burden. Tax brackets, adjusted for inflation, may lag 
behind rising incomes, resulting in individuals paying a 
larger proportion of their earnings in taxes. This 
widening tax wedge can erode the real value of income 
over time. 

(14)  The tax wedge is the ratio of personal income tax and 
employer and employee social security contributions, 
minus family benefits, divided by total labour costs. In 
2022, the tax wedge of a single person earning average 
wage was 46.8%, compared to an EU average of 
39.7%. See the EU tax and benefits indicator database 
(https://europa.eu/economy_finance/db_indicators/tab). 

10 

in the job market. By contrast, recurrent taxes 
on  property  are  among  the  lowest  in  the  EU, 
and  the  VAT  gap  also  ranks  comparatively 
high (15).  The  recently  announced  reform  to 
combat  legal  hurdles  for  states  (Länder)  to 
introduce taxes on vacant dwellings could help 
address  the  tax  gaps.  In  addition,  significant 
subsidies,  for  example  for  transport,  which 
have  detrimental  environmental  impacts,  are 
impeding the progress of the green transition. 
At  the  same  time,  the  recent  eco-social  tax 
reform provided relief measures in the area of 
taxes  and  social  security,  as  well  as 
introducing  CO2  pricing  in  the  transport  and 
heating sectors, which improves the tax mix.  

Long-term  care  needs are increasing and 
putting  pressure  on  fiscal  sustainability, 
while  staff  shortages  in  the  sector  are 
significant.  In  2022-2023,  Austria  passed  a 
reform  package  addressing  the  most  urgent 
challenges  to  ensuring  adequate  access  to 
long-term care. Recent measures, for instance 
investing  in  long-term  care  staff,  supporting 
informal  carers,  and  piloting  community 
nurses (under the RRP), will lead to an increase 
of  the  „Pflegefonds“ (16)  from  EUR  455.6 
to  EUR  1.1  billion  with  annual 
million 
valorisation (17).  There  may  still  be  further 
major  structural  challenges  to  improving  the 
legal and governance framework, which is still 
marked  by  a  division  of  responsibilities  and 
competencies  between  the  federal  state  and 
subnational levels. Additional fiscal pressure is 
due to the abolition of the ‘Pflegeregress’ (18), 
as  the  recourse  to the  assets  of  people  living 

Austria has the third highest tax wedge in the OECD 
(OECD 2024, Taxing Wages 2024). 

(15)  European Commission, CASE, Poniatowski, G., Bonch-

Osmolovskiy, M., Śmietanka, A., Pechcińska, A., VAT gap 
in the EU – Report 2022, Publications Office of the 
European Union, Luxembourg, 2022. 

(16)  The care fund is a financing instrument to ensure that 

adequate long-term care services can be funded in light 
of an ageing population. The federal level finances 2/3 
of its budget while regions and municipalities finance 
1/3. 

(17)  Budgetdienst (2023) – Finanzausgleich 2024. Analyse. 

(18)  Pflegeregress refers to the claim made by the Social 

Welfare Departments of the Austrian federal states on 
the private assets of a person receiving long-term care 
(Pflege-Eigenregress) and the assets of their relatives 
(Pflegeregress).  

 
 
 
 
in residential long-term care is now prohibited. 
This  provides  a  financial  incentive  to  use  the 
relatively  more  expensive  residential  care 
instead of home care.  

the 

provider. 

Despite  recent  reforms,  concerns  remain 
about 
sustainability  of  public 
healthcare  spending.  Health  care  spending, 
in particular on hospitals, is among the highest 
in  the  EU.  Public  funding  of  healthcare  is 
projected  to  increase  from  7.8%  of  GDP  in 
in  2050 (19), (20).  By 
2022  to  8.8%  GDP 
healthcare 
primary 
outpatient 
contrast, 
remains underdeveloped, with patients directly 
seeking care at hospitals, which is the costliest 
care 
in 
governance and financing persists and adds to 
the  inefficiency  of  the  healthcare  system.  At 
the  same  time,  the  recent  healthcare  reform, 
and  investments  under  the  RRP  will  help  to 
in 
further  strengthen  primary  healthcare, 
particular  by  supporting  new  and  existing 
primary  healthcare  units  across  the  country. 
Moreover,  the  reform  is  expected  to  help  to 
pursue  structural  reforms 
in  the  hospital 
sector, to improve medicine supply, vaccination 
programmes  and  health  promotion  and 
prevention. 

fragmentation 

The 

is  set  to 

With  a  projected  decline  in  the  working-
age  population,  government  spending  on 
increase  further. 
pensions 
Pension  expenditure  is  expected  to  increase 
from 13.7% of GDP in 2022 to 15% of GDP in 
2030,  and  to  stabilise  at  14%  of  GDP  in  the 
long-term.  While  the  statutory  pension  rights 
are  considered  adequate  overall,  offering  a 
relatively high degree of income maintenance, 
challenges  of  income  inequality  in  old  age 
persist. In particular, given the very high share 
of  women  working  part-time,  the  gender 
pension  gap  stood  at  34.4%  in  2022,  well 
above the EU average of 26% (see Annex 14). 
The  overall  effective  retirement  age  remains 
considerably below the pensionable age, given 
various early retirement schemes. As of 2024, 
the  statutory  retirement  age  for  women  is 

in 

gradually  being  aligned  with  that  for  men, 
increasing  to  65  years  in  2033.  However, 
despite  increasing  life  expectancy,  there  is  no 
link between the statutory retirement age and 
life  expectancy.  While  the  RRP 
gains 
includes  measures  to  tackle  these  increasing 
costs, such as pension splitting, further efforts 
should  be  made  to  ease  the  strain  on 
government  spending  arising  from  the  ageing 
population.  This 
involves  supporting  and 
incentivising  women  with care  responsibilities, 
older  workers  and  other  groups  with  low 
labour  market  attainment  to  increase  their 
working hours, as well as encouraging parents 
to split pensions.  

Promoting risk capital to boost 
productivity and competitiveness 

Austria  would  benefit  from  greater 
business dynamism to boost the efficient 
allocation  of  resources  and  productivity 
growth.  The  rates  of  creation  and  closing 
down  of  companies  are  among  the  lowest  in 
the EU. The proportion of start-ups and young 
companies,  which  tend  to  achieve  higher 
annual productivity gains than older firms (21), 
has steadily decreased (3.8% in 2020) and the 
share  of  fast-growing  companies  was  below 
the  EU  average  (7.29%  according  to  the 
number of employees vs 12.4% for the EU, in 
2021).  The  start-up  package  included  in  the 
‘Flexible 
RRP, 
Kapitalgesellschaft’  corporate  form,  aims  to 
facilitate  the  creation  and  scaling  up  of 
technology start-ups through greater flexibility 
in  shareholding 
in  allocating  shares  and 
relationships. 
indicates 
significant  take-up  of  the  new  possibilities. 
Furthermore, 
the 
insolvency framework to enable the timely exit 
of non-viable companies with low productivity 
could  also  support  business  dynamism.  The 
easing  of  business  regulations  that  currently 
to  certain  services  and 
restrict  access 

particularly 

evidence 

targeted 

changes 

Early 

new 

the 

in 

(19)  European Commission (2024), 2024 Ageing Report.   

(20)  These projection results do not incorporate recent 

reforms of the financial equalization scheme 2024-
2028. 

(21)  Peneder, M. (2021), “Entwicklung der Produktivität 
österreichischer Unternehmen von 2008 bis 2018. 
Auswertung von Mikrodaten für Österreich im Rahmen 
von Multiprod 2.0”, WIFO.  

11 

 
 
 
could 

further 
professions 
productivity  gains  and  greater  competition, 
including in the retail sector (see Annex 12). 

unlock 

also 

Better  access  to  risk  capital  could  help 
translate  investments  in  research  and 
innovation  into  higher  business  growth 
and  productivity.  While  Austria  has  a 
favourable  innovation  framework  and  high 
levels  of  R&D  expenditure  (3.2%  of  GDP) 
compared to other countries, a shortage of risk 
capital  hinders  growth  of  innovative  start-ups 
and  SMEs.  In  spite  of  some  improvement  in 
recent  years,  private  equity  (0.14%)  and 
venture  capital (0.041%) financing as a share 
of  GDP  in  2022  was  still  underdeveloped  by 
international  standards,  compared  to  the  EU 
average of 0.42% and 0.09% respectively (see 
Annex  12).  To 
for 
technology  start-ups  with  high  potential  to 
scale  up,  in  2023  the  Austrian  promotional 
bank  AWS  launched  a  new  venture  capital 
fund of EUR 72 million (22) and a new ‘Startup 
Invest’  initiative  (see  Annex  11).  There  is  still 
room to improve later-stage funding, including 
the  conditions  for  institutional  investors  to 
invest in venture capital. 

financing 

improve 

Investing in people to address 
labour and skills shortages 

hampering 

Skills  shortages  and  skills  mismatches 
competitiveness. 
are 
Widespread labour shortages and mismatches 
are among Austria’s most pressing issues and 
the  ageing  of  the  population  is  set  to  further 
exacerbate the situation. Austria’s job vacancy 
rate remains one of the highest in the EU and 
has remained over 4% since the end of 2021. 
Labour  shortages  are  particularly  prevalent  in 
the service and construction sector, but also in 
the IT, tourism, healthcare, and long-term care 
sectors.  On  the  regional  level,  Vorarlberg, 
Salzburg  and  Upper  Austria  are  particularly 
affected,  as  the  number  of  job  seekers  per 
vacancy  is  below  1.5,  whereas  in  Vienna  it  is 
close to 6. As a result, entrepreneurs in Austria 

of 

the 

share 

innovation 

is  hampered,  and 
report  that 
revenues  are  declining  (Annexes  10  and  14). 
The  full-time  employment  rate  of  women  is 
below  the  EU  average,  although  an  upward 
trend  can  be  observed.  With  fewer  digital 
skills, and often facing discriminatory practices 
because of their age, it is difficult for workers 
over  55  to  find  work.  People  with  a  low  level 
of  skills  are  particularly  vulnerable  and 
represent 
the 
highest 
unemployed.  Similarly,  people  with  a  migrant 
background  and  people  with  a  disadvantaged 
socio-economic  background  face  particular 
barriers  to  employment,  including  because  of 
challenges  to  transition  from  school  to  work. 
To  meet  its  labour  market  needs,  Austria  is 
investing  into  up-  and  reskilling  (including 
literacy  and  language  training)  of  persons 
entitled  to  asylum  and  subsidiary  protection. 
However,  refugees,  a  particularly  vulnerable 
group,  encounter  hurdles  finding  housing  in 
regions  with  labour  shortages  where  their 
labour  market  integration  would  be  easier.  At 
the same time, skills shortages are increasing 
in  key  sectors  for  the  green  transition  (Annex 
8). 

Improving  the  availability  and  quality  of 
early  childhood  education  and  care 
services  (ECEC)  could  enable  parents, 
notably  women,  to  work  more  hours.  The 
rate  of  participation  in  ECEC  in  Austria,  is 
below  the  EU  average  (34.9%)  and  the 
national Barcelona target (31.9%) for children 
under  the  age  of  3.  In  2023,  only  24.1%  of 
children  under  the  age  of  3  received  formal 
childcare  (see  Annex  14).    The  insufficient 
provision  of  quality  ECEC  facilities,  together 
with  strong  regional  differences,  plays  a  key 
role  in  the  high  proportion  of  women  in  part-
time employment, which is one of the highest 
in the EU. The double burden of paid work and 
care  obligations  affects  women  significantly 
more than men (23).  There are staff shortages 
in  ECEC,  and  the  continuous  expansion  of 
supply, combined with policy action to increase 
quality, means that at least 20 200 more staff 
will  be  needed  by  2030  (see  Annex  15).  The 
government is taking measures to improve the 
availability  and  quality  of  ECEC,  including 

(22)  AWS Gründungsfonds II. 

(23)  Statistik Austria (2023) – Zeitverwendung 2021/22. 

12 

 
 
 
improving 

its  RRP  and  additional  national 
through 
funding,  as  well  as  by 
the 
attractiveness  of  the  teaching  profession (24), 
but challenges remain. While support from the 
recently  established  ‘Zukunftsfonds’  (EUR 527 
million  per  year  on  average)  is  linked  to 
quantitative  and  qualitative  targets,  including 
for  childcare,  introducing  compulsory  quality 
standards  in  ECEC  could  better  ensure  the 
provision of quality care across the country.  

measures,  however,  may  also  help,  including: 
(i) improving the provision of quality ECEC; (ii) 
targeted  support  to  schools  with  specific 
needs; (iii) ensuring sufficient and well-trained 
staff in education; and (iv) more investment in 
education.  Such  measures  could  also  help,  in 
particular,  to  cope  with  the  challenges  of 
increased  diversity,  for 
through 
German  language  support,  and  to  provide 
tailored adult education measures.  

instance 

of 

since 

2012 

pupils 

(Annex 

results  of 

low-achieving 

the  Programme 

There  is  scope  to  improve  basic  skills,  in 
particular  of  pupils  and  young  people 
from  a  disadvantaged  and  migrant 
background.  Education  outcomes  in  Austria 
are  around  or  slightly  above  the  EU  average. 
For  instance,  the  share  of  Austrian  pupils 
reaching  the  highest  levels  in  mathematics, 
reading  and  science  is  above  the  EU  average 
in  all  three  fields.  However,  according  to  the 
2022 
for 
International  Student  Assessment  (PISA),  the 
proportion 
in 
mathematics  and  reading  has  continuously 
increased 
15). 
Underachievement has increased, in particular, 
among  pupils 
from  disadvantaged  and 
migrant  backgrounds.  Around  one  in  four  15-
year-olds  does  not  acquire  minimum  skills. 
Furthermore,  young  people  (18-24  years  old) 
born  outside  the  EU  are  nearly  twice  more 
likely  to  leave  school  early,  which  severely 
affects their prospects on the job  market and 
social  integration  (see  Annex  14).   Preventing 
young  people  from  leaving  education  and 
training early is key to reducing various risks in 
their 
unemployment, 
including 
economic  inactivity  and  employment  in  low-
paid jobs with few or no prospects for training 
and career progression. Moreover, the increase 
in  underperformance  in  basic  skills  and  the 
higher  proportion  of  early  school  leavers  in 
some  groups  may  pose  risks  to  successfully 
addressing  skills  shortages  in  the  long  run, 
therefore 
country’s 
competitiveness and capacity to innovate. The 
improve  skills 
RRP  contains  measures  to 
supply  and  the  educational  outcomes  of 
disadvantaged  pupils  (Section  2).    Additional 

hampering 

future, 

the 

(24)  European Commission (2023) European Semester – 

Austria Country Report. 

13 

Stepping up the green transition 
and diversification to improve 
energy security  

Graph 3.2: Gas imports are gradually declining, 
but Russia is still the dominant supply source 

Source: AT Climate Ministry, Energy Portal, May 2024 

Greater  efforts  are  needed  to  reduce 
Austria’s dependence on Russian gas.  The 
security  of  Austria’s  energy  supply  has 
improved  thanks  to  increased  gas  imports 
from  Norway  and,  to  a  lesser  extent,  from 
North  Africa  and  Central  Asia,  via  transport 
capacities  in  Germany  and  Italy,  including 
liquified  natural  gas,  as  well  as  the  strategic 
gas  reserve  created  in  2022.  However,  the 
monthly  share  of  gas  imports  from  Russia 
remained  significant  throughout  2023  (see 
Graph  3.2).    A  decoupling  from  the  long-term 
supply  contract  between  the  Austrian  energy 
company  OMV  and  Russia's  Gazprom  would 
facilitate  further  efforts  to  diversify  energy 
sources.  To  this  end,  the  Climate  Ministry 
made  a  proposal  aiming  at  terminating  the 
contract  and  imposing  a  legal  obligation  on 
domestic gas suppliers to gradually phase out 

7464526066438090769897879326364840345720102423137020406080100120Mar/23Apr/23May/23Jun/23Jul/23Aug/23Sep/23Oct/23Nov/23Dec/23Jan/24Feb/24Mar/24from Russia in %from other sources in %100= total gas imports Feb 2022 
 
   
Russian  gas.  The  government  also  intends  to 
provide investment support (EUR 70 million) to 
upgrade  the  West  Austria  gas  pipeline,  which 
would  increase  the  transport  capacity  from 
Germany  by  30%  and  also  enable  hydrogen 
transport  in  the  future.  In  2022,  Austria's 
natural  gas  consumption  went  down  to  7.9 
billion  cubic  meters  (12.2%  less  than  in 
2021) (25),  accounting  for  21.8% (26)  of  gross 
energy  consumption,  which  is  close  to  the  EU 
average (2022).  

its  Environmental 

renewables  has 
The  expansion  of 
accelerated,  but  the  target  of  climate 
neutrality  by  2040  is  demanding  and 
more speed and investments are required 
for  wind  energy,  grid  upgrade  and 
expansion.  The  installed  renewable  energy 
capacity  increased  by  6%  in  2022,  with  a 
significant  growth  in  solar  energy,  but  the 
current  expansion  rate  is  not  fast  enough  for 
Austria  to  reach  its  national  target  of  100% 
renewable  electricity  by  2030.  With  the 
Impact 
amendment  of 
Assessment  Act  in  2023,  and  by  allowing 
investment in  smaller  PV installations  without 
a  permit,  Austria  has  taken  some  steps  to 
speed  up  the  implementation  of  renewable 
energy  projects.  However,  further  (regulatory) 
initiatives to accelerate permitting are needed 
to address the remaining bottlenecks, such as 
of 
staffing, 
competences between the federal and regional 
levels. Moreover, upgrading and expanding the 
transmission  and  distribution  grids,  especially 
between  East  and  West  Austria,  remains  a 
priority,  including  cross-border  infrastructure 
investment  as  set  out  in  the  first  integrated 
net infrastructure plan published in April 2024 
(see  Annex  7).  Austria  expects  18  GW  of 
additional  renewable  energy  capacity  to  be 
installed  by  2030.  This  requires  both  more 
investment  and  a  faster  implementation  of 
measures 
integrate  additional  power 
generation into the transmission system.  

complex 

sharing 

and 

to 

a 

In  2022, 

greenhouse 

sector  and  to  reduce  emissions  from 
transport. 
gas 
emissions  related  to  buildings  declined  by 
17%  due  to  the  relatively  low  number  of 
heating  days,  high  energy  prices  and  support 
for  energy  efficiency  measures, 
including 
investment  and  reforms  under  the  RRP. 
However, 76% of Austrian buildings were built 
before  stricter  energy  performance  standards 
were introduced, and Austria’s building stock is 
in  the  lower  third  as  regards  performance  on 
the  EU (27). 
final  energy  consumption 
Transport  emissions  per  capita  are  above  the 
EU average (28), including because of so-called 
‘fuel 
by 
environmentally  harmful  tax  incentives.  The 
‘Klimaticket’  has  made  public  transport  more 
remains  scope 
attractive  but 
to 
strengthen  public 
transport  services  and 
alternatives  to  private  car  use  in  rural  and 
remote  regions,  where  40%  of  the  population 
live.  

supported 

tourism’ 

there 

tank 

in 

their 

Industry 

in  Austria 

outperformed 

Further  investments  are  needed  to  make 
industry  greener  and  to  maintain  its 
competitiveness. 
is 
broadly diversified and accounts for 21.9% of 
gross  value  added  (20.6%  in  the  EU).  Since 
2000,  industrial  production  has  seen  strong 
growth, benefiting from dynamic development 
in  key  manufacturing  sectors,  which  also 
German 
markedly 
peers (29). Industrial production, which includes 
‘hard-to-abate’  sectors  such  as  steelmaking 
and chemicals, represents more than a fifth of 
total  greenhouse  gas  emissions.  In  2022, 
energy and industry emissions covered by the 
EU  Emissions  Trading  System  declined  by 
7.2%, owing to a reduction in steel production 
and  an  incident  at  Austria’s  main  oil  refinery 
that  forced  it  out  of  operation  for  several 
months.  Low-emission 
technologies  and 
energy efficiency improvements, therefore, are 
crucial to preserve long-term competitiveness. 
Increasing  the  use  of  circular  materials  in 

There is still significant potential to make 
additional  energy  savings  in  the  building 

(27)  ODYSSEE-Mure database, 2024:  Average energy 

consumption per dwelling.  

(28)  European Commission (2023) - State of the Energy 

(25)  Statistical Review of World Energy 2023, Energy 

Union Report 2023. 

Institute. 

(26)  Eurostat, Simplified energy balances. 

(29)  Scheiblecker M., WIFO 05/2023, Austrian Industrial 

Production in a Country Comparison. 

14 

 
 
 
Box 4: 

The mid-term review of cohesion policy funds for Austria 

The  mid-term  review  of  cohesion  policy  funds  is  an  opportunity  to  assess  cohesion 
policy programmes and to tackle emerging needs and challenges in EU Member States 
and their regions. Member States are reviewing each programme taking into account; among 
other things the challenges identified in the European Semester, including in the 2024 country-
specific recommendations. This review forms the basis for a proposal by the Member State for 
the definitive allocation of 15% of EU funding included in each programme.   

Austria  has  made  progress  in  the  implementation  of  cohesion  policy  programmes  and  the 
European  Pillar  of  Social  Rights,  but  challenges  remain  as  outlined  in  this  report,  including 
Annexes  14  and  17.  While  Austria  has  one  of  the  lowest  regional  disparities  in  the  EU,  the 
existing differences in GDP per capita, labour productivity and the distribution of R&D investment 
risk  being  reinforced  in  the  future  by  demographic  challenges  arising  from  issues  such  as  the 
ongoing transition from non-urban to urban areas. Against this background, it remains important 
to  continue  implementing  planned  priorities,  paying  particular  attention  to:  (i)  integrated 
territorial  development  approaches  to  support  inclusive  and  sustainable  local  development;  (ii) 
improving  the  efficiency  of  the  research  and  innovation  system,  in  line  with  the  national  and 
regional  smart  specialisation  strategies,  and  exploiting  science-business  links;  (iii)  energy 
efficiency and reduction of the carbon footprint, including through emerging green technologies; 
(iv)  the  quality  and  inclusiveness  of  education,  training  and  lifelong  learning,  in  particular  for 
disadvantaged groups, to better anticipate change and to give people skills that are relevant for 
the  current  labour  market;  and  (v)  active  inclusion  and  employability,  in  particular  for 
disadvantaged groups. 

Austria  could  benefit  from the  opportunities provided  by  the  Strategic  Technologies for  Europe 
Platform  (STEP)  Regulation (31)  to  support  the  development  or  manufacturing  of  critical 
technologies, including clean and resource-efficient technologies. 

and  ecosystem  fragmentation,  bolster  food 
security and strengthen climate resilience (see 
Annex 5).  

industry  and  construction  would  also  help  to 
use  fewer  resources  and  strengthen  Austria’s 
strategic  autonomy  (see  Annex  9).  In  addition 
to  projects  financed  by  the  Austrian  RRP,  the 
European Regional Development Fund and the 
Just  Transition  Fund,  the  government’s  new 
climate  transformation 
initiative  (EUR  5.7 
billion  until  2030)  supporting  climate  neutral 
projects  will  help  to  boost  Austria’s  strong 
position  in  the  fast-growing  sectors  that  are 
producing net-zero technologies.  

system 

continues 

Reducing  net  land-take  and  soil  sealing 
remains  a  major  challenge  and  the  built 
environment 
to 
exacerbate  pressures  on  resources.  The 
total  amount  of  land  use  in  Austria  in  2022 
corresponded  to  17.3%  of  the  permanent 
settlement  area,  52%  of  which  is  sealed (30). 
Despite evident improvements in conservation 
and  restoration  efforts,  the  status  of  many 
habitats  and  species  continues  to  deteriorate. 
Prioritising  the  efficient  use  of  land  and 
buildings  would  help  counter  biodiversity  loss 

(30)  Österreichische Raumordnungskonferenz (ÖROK) 2023: 

Flächeninanspruchnahme und Versiegelung in 
Österreich. 

(31)  Regulation (EU) 2024/795.  

15 

 
 
 
 
KEY FINDINGS 

resilience  plan 

With  its  wide  policy  scope,  Austria’s 
(RRP) 
recovery  and 
includes measures to address a series of 
structural  challenges,  in  synergy  with 
other  EU  funds,  including  cohesion  policy 
funds, by:  

•  Advancing  the  green  transition  by 
reforming  the  tax  system;  accelerating  the 
deployment of renewable energy (including 
energy 
hydrogen);  and 
efficiency, 
the 
clean 
industry,  biodiversity 
decarbonisation  of 
and the circular economy; 

in 
mobility, 

investing 

•  Supporting  the  digital  transformation 
in 
and  competitiveness  by 
innovation  such  as  quantum 
strategic 
computing,  microelectronics, 
precision 
medicine;  upgrading  digital  infrastructures 
and  skills;  and  reducing  regulatory  barriers 
that hinder business productivity; 

investing 

•  Improving  the  skills  and  supply  of 
workers  by  increasing  the  availability  of 
quality  early  childcare  places,  improving 
for 
educational 
in 
disadvantaged  pupils,  and 
upskilling  and  reskilling  to  meet  the  needs 
of the labour market; 

outcomes, 

especially 

investing 

•  Improving access to and the efficiency 
of  the  healthcare  system  by  enhancing 
primary  healthcare  and  the  digitisation  of 
health services. 

The implementation of Austria’s recovery 
and  resilience  plan  is  facing  increasing 
challenges.  Renewed  efforts  are  key  for  a 
successful implementation of all the measures 
of  Austria’s  recovery  and  resilience  plan  by 
August 2026. 

16 

Beyond  the  reforms  and  investments  in 
the  RRP  and  cohesion  programmes, 
Austria would benefit from: 

the 

•  Consolidating  its  public  finances  by 
fiscal  sustainability  and 
ensuring 
adequacy  of  the 
long-term  care  and 
healthcare  systems  and  by  simplifying  the 
fiscal  framework  across  different  levels  of 
government  to  increase  the  efficiency  of 
public spending;  

•  Further  improving  the  tax  mix  to  be 
more  conducive  to  growth  by  shifting  the 
tax  burden  away  from  labour  and  ending 
environmentally harmful tax schemes. 

•  Improving  its  innovation  performance 
and  competitiveness  by  promoting  the 
creation  and  growth  of  new  companies, 
including  through  better  access  to  risk 
capital; 

•  Addressing labour and skills shortages 
by boosting the labour market participation 
of  women  (including  full-time  work);  by 
promoting  labour  market  access  for  older, 
low-skilled  workers  and  people  with  a 
improving  the 
migrant  background;  by 
quality  and  availability  of  early  childhood 
education  and  care;  and  by  improving  the 
basic skills of disadvantaged pupils; 

•  Improving  energy  security  by  setting  a 
clear  strategy  to  diversify  towards  non-
Russian gas suppliers and by upgrading the 
grid  to  match  the  accelerated  pace  of  the 
expansion of renewable energy. 

•  Further  investing  in  the  reduction  of 
emissions  and  in  energy  savings,  in 
particular  in  the  transport  and  building 
sectors.   

 
 
ANNEXES 

 
 
 
 
LIST OF ANNEXES 

Cross-cutting indicators 

A1.  Sustainable Development Goals 

A2.  Progress in the implementation of country-specific recommendations 

A3.  Recovery and resilience plan – implementation 

A4.  Other EU instruments for recovery and growth 

A5.  Resilience 

Environmental sustainability 

A6.  European Green Deal 

A7.  Energy transition and competitiveness 

A8.  Fair transition to climate neutrality 

Productivity 

A9.  Resource productivity, efficiency and circularity 

A10.  Digital transformation 

A11.  Innovation 

A12.  Industry and single market 

A13.  Public administration 

Fairness 

A14.  Employment, skills and social policy challenges in light of the European Pillar of Social Rights 

A15.  Education and training 

A16.  Health and health systems 

A17.  Economic and social performance at regional level 

Macroeconomic stability 

A18.  Key financial sector developments 

A19.  Taxation 

A20.  Table with economic and financial indicators 

A21.  Debt sustainability analysis 

LIST OF TABLES 

A2.1. 
A3.1. 

Summary table on 2019-2023 CSRs 
Key facts of the Austrian RRP 

19 

21 

21 

23 

27 

29 

32 

34 

34 

38 

43 

46 

46 

48 

50 

52 

57 

59 

59 

62 

64 

66 

69 

69 

71 

73 

74 

24 
27 

 
 
 
Support from EU instruments in Austria 
Resilience indices across dimensions for Austria and the EU-27 
Indicators tracking progress on the European Green Deal from a macroeconomic perspective 
Key Energy Indicators 
Key indicators for a fair transition in Austria 
Circularity indicators 

A3.2.  Measures in Austria's RRP 
A4.1. 
A5.1. 
A6.1. 
A7.1. 
A8.1. 
A9.1. 
A10.1.  Key Digital Decade targets monitored by the Digital Economy and Society Index indicators 
A11.1.  Key innovation indicators 
A12.1.  Single Market and Industry 
A13.1.  Public administration indicators 
A14.1.  Social Scoreboard for Austria 
A14.2.  Situation of Austria on 2030 employment, skills and poverty reduction targets 
A15.1.  EU-level targets and other contextual indicators under the European Education Area strategic framework 
A16.1.  Key health indicators 
A17.1.  Selected indicators at regional level in Austria 
A18.1.  Financial soundness indicators 
A19.1.  Taxation indicators 
A20.1.  Key economic and financial indicators 
A21.1.  Debt sustainability analysis - Austria 
A21.2.  Heat map of fiscal sustainability risks - Austria 

LIST OF GRAPHS 

Progress towards the SDGs in Austria 
Austria’s progress on the 2019-2023 CSRs (2024 European Semester) 
Total grants disbursed under the RRF 
Distribution of cohesion policy funding across policy objectives in Austria 
Distribution of RRF funding by pillar in Austria 
Greenhouse gas emissions from the effort sharing sectors in Mt CO2eq, 2005-2022 
Changes in livestock density and organic farming 
Environmental investment gap, annual average 
Austria's energy retail prices for households and industry & service 
Trends in electricity prices for non-household consumers (EU and foreign partners) 
Austria's installed renewable capacity (left) and electricity generation mix (right) 
Fair transition challenges in Austria 
Job vacancy rate in transforming sectors and mining and quarrying 
ETS emissions by sector since 2013 
Treatment of municipal waste 

A1.1. 
A2.1. 
A3.1. 
A4.1. 
A4.2. 
A6.1. 
A6.2. 
A6.3. 
A7.1. 
A7.2. 
A7.3. 
A8.1. 
A8.2. 
A9.1. 
A9.2. 
A11.1.  Employment share of high growth enterprises measured in employment (%) 
A12.1.  Real labour productivity per hour worked at industry level (Index, 2015=100) 
A12.2.  Value added and employment in industry (% total) 
A13.1.  Government effectiveness 
A15.1.  Underachievement rates by field, PISA 2012, 2018 and 2022 
A16.1.  Life expectancy at birth, years 
A16.2.  Projected increase in public expenditure on healthcare over 2024-2070 
A17.1.  Austria, NUTS2: Average GDP per capita growth vs GDP per capita 
A17.2.  Evolution of labour productivity (real GVA per worker) in Austria 
A18.1.  Housing prices and mortgage lending 
A19.1.  Tax revenues from different tax types, % of total revenue 
A19.2.  Tax wedge for single and second earners as a % of total labour costs, 2023 

LIST OF MAPS 

A17.1.  Austria, NUTS2: GDP per capita growth 2013-2022 

20 

28 
31 
32 
37 
42 
44 
47 
49 
51 
56 
58 
59 
60 
63 
65 
68 
69 
71 
73 
76 
76 

21 
23 
28 
30 
30 
34 
35 
36 
38 
38 
39 
43 
44 
46 
47 
50 
52 
54 
57 
62 
64 
64 
66 
67 
70 
72 
72 

66 

 
 
 
 
CROSS-CUTTING INDICATORS 
ANNEX 1: SUSTAINABLE DEVELOPMENT GOALS 

This  annex  assesses  Austria’s  progress  on 
the  Sustainable  Development  Goals  (SDGs) 
along  the  four  dimensions  of  competitive 
sustainability.  The  17  SDGs  and  their  related 
indicators  provide  a  policy  framework  under  the 
UN’s  2030  Agenda  for  Sustainable  Development. 
The  aim  is  to  end  all  forms  of  poverty,  fight 
inequalities  and  tackle  climate  change  and  the 
environmental crisis, while ensuring that no one is 
left  behind.  The  EU  and  its  Member  States  are 
committed  to  this  historic  global  framework 
agreement  and  to  playing  an  active  role  in 
maximising  progress  on  the  SDGs.  The  graph 
below  is  based  on  the  EU  SDG  indicator  set 
developed  to monitor progress  on  the  SDGs  in  an 
EU context. 

SDG 

Austria  performs  well  or  is  improving  on 
to 
indicators 
most 
environmental sustainability (SDGs 2, 6, 7, 9, 
11,  12,  13,  14),  but  it  is  moving  away  from 
SDG 15  (Life  on  land).  Historically,  Austria  has 
performed  very  well  on  the  share  of  renewable 

related 

energy  in  its  gross  final  energy  consumption.  It 
was  able  to  further  increase  this  share  from 
33.1% in 2017 to 33.8% in 2022, well above the 
EU average (23.0% in 2022). Various measures in 
the  recovery  and  resilience  plan  (RRP)  aim  to 
further  contribute  to  general  greenhouse  gas 
emission savings and are likely to positively affect 
sustainability.  These 
Austria’s  environmental 
measures  include  the  eco-social  tax  reform,  the 
Renewables  Expansion  Law  and  investment  in 
renewables,  energy  efficiency, 
zero-emission 
mobility and biodiversity. On SDG 15 (Life on land), 
Austria  is  slightly  moving  away  from  the  goal, 
particularly due to continued soil sealing (with the 
index  increasing  from  103.3  in  2015  to  106.7  in 
2018)  and  the  rising  impact  of  drought  on 
ecosystems. The biodiversity strategy published by 
Austria in 2022 and the Biodiversity Fund enacted 
as  part  of  the  Austrian  RRP  will  help  address this 
lag. 

While  Austria  generally  performs  well  or  is 
indicators  related  to 
improving  on  SDG 

Graph A1.1: Progress towards the SDGs in Austria 

For detailed datasets on the various SDGs, see the annual Eurostat report ‘Sustainable development in the European Union’; for 
details on extensive country-specific data on the short-term progress of Member States: Key findings – Sustainable development 
indicators - Eurostat (europa.eu). A high status does not mean that a country is close to reaching a specific SDG, but signals that it 
is doing better than the EU on average. The progress score is an absolute measure based on the indicator trends over the past 5 
years. The calculation does not take into account any target values as most EU policy targets are only valid for the aggregate EU 
level. Depending on data availability for each goal, not all 17 SDGs are shown for each country. 
Source: Eurostat, latest update of 25 April 2024. Data refer mainly to the period 2017-2022 or 2018-2023. Data on SDGs may 
vary across the report and its annexes due to different cut-off dates. 

21 

 
 
 
 
 
 
 
includes  several 

targeted  measures 

predictable  environment  for  doing  business.  The 
to 
RRP 
improve  the  sustainability  of  the  pension  system 
and the quality of public spending, and the plan is 
therefore  expected  to  also  contribute  to  some 
long-term  macroeconomic 
extent  to  Austria’s 
stability.  On  partnerships  for  the  goals  (SDG  17), 
Austria  showed  progress,  but  it  is  still  performing 
poorly compared to the EU average, particularly on 
official  development  assistance  and  the  share  of 
households with a high-speed internet connection. 

As the SDGs form an overarching framework, 
any links to relevant SDGs are either explained or 
depicted with icons in the other annexes. 

fairness  (SDGs 1,  3,  5,  7,  8,  10),  there  are 
adverse trends in some indicators for quality 
education  (SDG 4).  Austria  is  performing  better 
on  the  healthy  life  expectancy  indicator  (SDG 3; 
61.8 years in 2021 compared to 57 years in 2016; 
EU  average:  63.6  years  in  2021).  Austria  has 
reversed  course  on  the  in-work  at-risk-of-poverty 
rate  (SDG 1;  8.2%  in  2022,  compared  to  7.7%  in 
2017),  but  the  long-term  unemployment  rate 
continued  to  improve  (SDG 8;  1.1%  in  2023 
compared to 1.7% in 2018; EU average: 2.1%). On 
SDG 4  (Quality  education),  Austria  increased  the 
participation rate in early childhood education and 
care  (for  3-to-5-year-olds)  to  89%  in  2021  and 
steadily  increased  its  share  of  adults  with  a 
tertiary  qualification  from  40.3%  in  2017  to 
43.1%  in  2022.  However,  there  is  still  room  for 
improvement  in  ensuring  equal  opportunities  in 
education,  particularly  for  disadvantaged  young 
people, and also in increasing gender equality and 
social  inclusion.  This  has  been  acknowledged  by 
several measures in the Austrian RRP targeted at: 
(i) access to education, training and upskilling; and 
(ii) assistance to socially disadvantaged women. 

indicators 

Austria  performs  well  or  very  well  on  most 
SDG 
to  productivity 
related 
(SDGs 8  and  9),  and  productivity-related 
indicators  within  quality  education  (SDG 4). 
Compared  to  the  EU  average  (55.6%),  Austria 
performs relatively well in digital skills, with 64.7% 
of  adults  having  at  least  basic  digital  skills  in 
2023. Austria also performs well on SDG 8 (Decent 
work  and  economic  growth)  and  SDG 9  (Industry, 
innovation  and  infrastructure).  With  3.2%  of  GDP 
allocated to  R&D  in  2022,  Austria  has  one  of the 
highest  levels  of  R&D  spending  in  the  EU.  The 
share  of  R&D  personnel  in  the  active  population 
rose  from  1.71%  in  2016  to  2.02%  in  2022  (EU 
average:  1.53%  in  2022).  Austria’s  RRP  contains 
several  measures  to  address  bottlenecks 
in 
digitalisation  and  make  significant  investments  in 
strategic  research  and  innovation.  This  should 
ensure further progress on these SDGs. 

Overall,  Austria  performs  well  on  indicators 
related  to  macroeconomic  stability  (SDGs 8 
and  16),  while  it  needs  to  catch  up  on 
partnerships  for  the  goals  (SDG 17).  Austria 
performs well on SDG 8 and notably increased its 
investment  share  of  GDP  from  23.6%  in  2017  to 
25.3%  in  2022  (EU  average:  22.9%  in  2022).  In 
addition, Austria achieves high scores on indicators 
measuring  peace,  justice  and  strong  institutions 
(SDG 16),  showing  that  there  is  a  stable  and 

22 

 
 
ANNEX 2: PROGRESS IN THE IMPLEMENTATION OF COUNTRY-SPECIFIC 
RECOMMENDATIONS 

The Commission has assessed the 2019-2023 
country-specific  recommendations  (CSRs) (32) 
addressed to Austria as part of the European 
Semester.  These  recommendations  concern  a 
wide  range  of  policy  areas  that  are  related  to  14 
of  the  17  Sustainable  Development  Goals  (SDGs) 
(see  Annexes  1  and  3). The  assessment  considers 
the policy  action taken  by  Austria  to  date (33)  and 
the  commitments  in  its  recovery  and  resilience 
plan 
RRP 
implementation,  71%  of  the  CSRs  focusing  on 
structural  issues  from  2019-2023  have  recorded 
at  least  ‘some  progress’,  while  29%  recorded 
‘limited progress’ or ‘no progress’ (see Graph A2.1). 
As  the  RRP  is  implemented  further,  considerable 
progress in addressing structural CSRs is expected 
in the coming years. 

(RRP) (34). 

stage 

this 

At 

of 

Graph A2.1: Austria’s progress on the 2019-2023 
CSRs (2024 European Semester) 

Source: European Commission. 

(32)  2023 CSRs: EUR-Lex - 32023H0901(20) - EN - EUR-Lex 

(europa.eu) 

2022 CSRs: EUR-Lex - 32022H0901(20) - EN - EUR-Lex 

(europa.eu) 

      2021 CSRs: EUR-Lex - 32021H0729(20) - EN - EUR-Lex 

(europa.eu) 

      2020 CSRs: EUR-Lex - 32020H0826(20) - EN - EUR-Lex 

(europa.eu) 
2019 CSRs: EUR-Lex - 32019H0905(20) - EN - EUR-Lex 
(europa.eu) 

(33)  Including policy action reported in Recovery and Resilience 
Facility (RRF) reporting (published twice a year, reporting on 
progress in implementing milestones and targets on the 
basis of the payment requests assessment). 

(34)  Member States were asked to effectively address in their 
RRPs all or a significant subset of the relevant country-
specific recommendations issued by the Council. The CSR 
assessment presented here considers the degree of 
implementation of the measures included in the RRP and of 
those carried out outside of the RRP at the time of 
assessment. Measures laid down in the Annex of the 
adopted Council Implementing Decision on approving the 
assessment of the RRP, which have not yet been adopted or 
implemented but considered credibly announced, in line with 
the CSR assessment methodology, warrant ‘limited progress’. 
Once implemented, these measures can lead to 
‘some/substantial progress or full implementation’, 
depending on their relevance. 

23 

Limited progress27%Some progress56%Substantial progress13%Full implementation2% 
 
 
 
 
 
 
   
 
 
 
Table A2.1:  Summary table on 2019-2023 CSRs 

(Continued on the next page) 

24 

AustriaAssessment in May 2024*RRP coverage of CSRs until 2026**Relevant SDGs2019 CSR 1Limited progressEnsure the sustainability of the health, Some progressRelevant RRP measures being implemented as of 2021 and planned as of 2022 and 2023. SDG 3long-term care, Some ProgressRelevant RRP measures being implemented as of 2021. SDG 3and pension systems, including by adjusting the statutory retirement age in view of expected gains in life expectancy. Limited progressRelevant RRP measures being implemented as of 2020 and planned as of 2022.SDG 8Simplifyandrationalisefiscalrelationsandresponsibilitiesacrosslayersofgovernmentandalignfinancingandspendingresponsibilities.Limited progressRelevant RRP measures planned as of 2022. SDG 8, 162019 CSR 2Limited progressShift taxes away from labour to sources less detrimental to inclusive and sustainable growth. Some progressRelevant RRP measures being implemented as of 2021. SDG 8, 10, 12Support full-time employment among women, including by improving childcare services, Limited progressRelevant RRP measures planned as of 2023.SDG 4, 5, 8, 10and boost labour market outcomes for the low skilled in continued cooperation with the social partners. Limited progressRelevant RRP measures planned as of 2020.SDG 8, 10Raise the levels of basic skills for disadvantaged groups, including people with a migrant background.Limited progressRelevant RRP measures being implemented as of 2021 and planned as of 2025. SDG 4, 8, 102019 CSR 3Some progressFocus investment-related economic policy on research and development,  innovation, Substantial ProgressRelevant RRP measures being implemented as of 2021 and planned as of 2022 and 2024.SDG 9, 10, 11digitalisation,Some progressRelevant RRP measures planned as of 2021 and 2022.  SDG 9, 10, 11and sustainability, taking into account regional disparities. Some progressRelevant RRP measures being implemented as of 2020 and 2021 and planned as of 2022, 2023 and 2024. SDG 1, 7, 8, 9, 10, 11, 13Support productivity growth by stimulating digitalisation of businesses  and company growthSome progressRelevant RRP measures being implemented as of 2021 and planned as of 2022.  SDG 8, 9and by reducing regulatory barriers in the service sector.Limited progressRelevant RRP measures being implemented as of 2021. SDG 92020 CSR 1Some progressTakeallnecessarymeasures,inlinewiththegeneralescapeclauseoftheStabilityandGrowthPact,toeffectivelyaddresstheCOVID-19pandemic,sustaintheeconomyandsupporttheensuingrecovery.Wheneconomicconditionsallow,pursuefiscalpoliciesaimedatachievingprudentmedium-termfiscalpositionsandensuring debt sustainability, while enhancing investment. Not relevant anymoreNot applicableSDG 8, 16Improvetheresilienceofthehealthsystembystrengtheningpublichealth and primary care. Some progressRelevant RRP measures being implemented as of 2021 and planned as of 2022 and 2023. SDG 32020 CSR 2Some progressEnsure equal opportunities in educationSome progressRelevant RRP measures being implemented as of 2021 and planned as of 2025. SDG 4, 8, 10and increased digital learning. Some progressRelevant RRP measures being implemented as of 2020 and 2021. SDG 42020 CSR 3Substantial ProgressEnsure an effective implementation of liquidity and support measures, in particular for small and medium-sized enterprises,Full ImplementationNot applicableSDG 8, 9and reduce administrative and regulatory burden.Substantial ProgressRelevant RRP measures being implemented as of 2021. SDG 8, 9Front-load mature public investment projects Some progressRelevant RRP measures being implemented as of 2021. SDG 8, 16and promote private investment to foster the economic recovery. Some progressRelevant RRP measures being implemented as of 2021. SDG 8, 9Focusinvestmentonthegreenanddigitaltransition,inparticularonbasic and applied research, as well as innovation,Substantial ProgressRelevant RRP measures being implemented as of 2021 and planned as of 2022 and 2024.SDG 9sustainable transport, Some progressRelevant RRP measures being implemented as of 2020 and 2021 and planned as of 2022.SDG 11clean and efficient production and use of energy. Some progressRelevant RRP measures planned as of 2021 and 2022.  SDG 7, 9, 132020 CSR 4Some progressMakethetaxmixmoreefficientandmoresupportivetoinclusiveandsustainable growth. Some progressRelevant RRP measures being implemented as of 2021. SDG 8, 10, 12 
 
 
 
  
 
Table (continued) 

(Continued on the next page) 

25 

2021 CSR 1Substantial progressIn2022,maintainasupportivefiscalstance,includingtheimpulseprovidedbytheRecoveryandResilienceFacility,andpreservenationallyfinancedinvestment.Keepthegrowthofnationallyfinanced current expenditure under control.Not relevant anymoreNot applicableSDG 8, 16Wheneconomicconditionsallow,pursueafiscalpolicyaimedatachievingprudentmedium-termfiscalpositionsandensuringfiscalsustainability in the medium term. Not relevant anymoreNot applicableSDG 8, 16At the same time, enhance investment to boost growth potential.Payparticularattentiontothecompositionofpublicfinances,onboththerevenueandexpendituresidesofthebudget,andtothequalityofbudgetarymeasuresinordertoensureasustainableandinclusiverecovery.Prioritisesustainableandgrowth-enhancinginvestment,inparticularinvestmentsupportingthegreenanddigitaltransition.Not relevant anymoreNot applicableSDG 8, 16Giveprioritytofiscalstructuralreformsthatwillhelpprovidefinancingforpublicpolicyprioritiesandcontributetothelong-termsustainabilityofpublicfinances,including,whererelevant,bystrengtheningthecoverage,adequacyandsustainabilityofhealthand social protection systems for all.Not relevant anymoresNot applicableSDG 8, 162022 CSR 1Some progressIn 2023, ensure that the growth of nationally-financed primary current expenditure is in line with an overall neutral policy stance, taking into account continued temporary and targeted support to households and firms most vulnerable to energy price hikes and to people fleeing Ukraine. Stand ready to adjust current spending to the evolving situation. Substantial progressNot applicableSDG 8, 16Expand public investment for the green and digital transitions, and for energy security taking into account the REPowerEU initiative, including by making use of the Recovery and Resilience Facility and other Union funds.Substantial progressNot applicableSDG 8, 16 For the period beyond 2023, pursue a fiscal policy aimed at achieving prudent medium-term fiscal positions. Substantial ProgressNot applicableSDG 8, 16Ensure the adequacy and fiscal sustainability of the long-term care system. Some ProgressRelevant RRP measures being implemented as of 2021. SDG 3Simplify and rationalise fiscal relations and responsibilities across layers of government and align financing and spending responsibilities. Limited ProgressRelevant RRP measures planned as of 2022.SDG 8, 16Improve the tax mix to support inclusive and sustainable growth.Some ProgressRelevant RRP measures being implemented as of 2021. SDG 8, 10, 122022 CSR 2Proceed with the implementation of its recovery and resilience plan, in line with the milestones and targets included in the Council Implementing Decision of 13 July 2021. Swiftly finalise the negotiations with the Commission of the 2021-2027 cohesion policy programming documents with a view to starting their implementation. 2022 CSR 3Limited ProgressBoost labour market participation of women, including by enhancing quality childcare services,Limited ProgressRelevant RRP measures planned as of 2023.SDG 4, 5, 8, 10 and improve labour market outcomes for disadvantaged groups.Limited ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2025. SDG 8, 102022 CSR 4Some ProgressReduce overall reliance on fossil fuels, and diversify imports of fossil fuels,Limited ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2022. SDG 7, 9, 13 by accelerating the deployment of renewable energy and of the necessary infrastructure, in particular by simplifying planning and further streamlining permitting procedures,Some ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2022. SDG 7, 8, 9, 13 and enhancing energy efficiency, in particular in the industry and building sectorsSome ProgressRelevant RRP measures being implemented as of 2021 and planned as of 2022. SDG 7and diversifying energy supplies, as well as increasing flexibility and reverse-flow capacity of interconnectionsSome ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2022. SDG 7, 9RRP implementation is monitored by assessing RRP payment requests and analysing reports published twice a year on the achievement of the milestones and targets. These are to be reflected in the country reports. Progress on the cohesion policy programming documents is monitored under the EU cohesion policy. 
 
 
  
 
Table (continued) 

Note: 
* See footnote (34). 
** RRP measures included in this table contribute to the implementation of CSRs. Nevertheless, additional measures outside the 
RRP may be necessary to fully implement CSRs and address their underlying challenges. Measures indicated as ‘being 
implemented’ are only those included in the RRF payment requests submitted and positively assessed by the European 
Commission. 
Source: European Commission. 

26 

2023 CSR 1Some ProgressWind down the emergency energy support measures in force, using the related savings to reduce the government deficit, as soon as possible in 2023 and 2024. Should renewed energy price increases necessitate new or continued support measures, ensure that these are targeted at protecting vulnerable households and firms, fiscally affordable and preserve incentives for energy savings.Some ProgressNot applicableSDG 8, 16Ensure prudent fiscal policy, in particular by limiting the nominal increase in nationally-financed net primary expenditure in 2024 to not more than 4.6%.No ProgressNot applicableSDG 8, 16Preserve nationally-financed public investment and ensure the effective absorption of RRF grants and other EU funds, in particular to foster the green and digital transitions.Some ProgressSDG 8, 16For the period beyond 2024, continue to pursue a medium-term fiscal strategy of gradual and sustainable consolidation, combined with investments and reforms conducive to higher sustainable growth, to achieve a prudent medium-term fiscal position.Substantial ProgressNot applicableSDG 8, 16Ensure the adequacy and fiscal sustainability of the long-term care systemSome ProgressRelevant RRP measures being implemented as of 2021. SDG 3, 8and the fiscal sustainability of the health care system.Some ProgressSDG 3, 8Simplify and rationalise fiscal relationships and responsibilities across layers of government and align financing and spending responsibilities.Limited ProgressRelevant RRP measures planned as of 2022.SDG 8, 16Improve the tax mix to support inclusive and sustainable growth.Some ProgressRelevant RRP measures being implemented as of 2021. SDG 8, 10, 122023 CSR 2Continue the steady implementation of its recovery and resilience plan and swiftly finalise the REPowerEU chapter with a view to rapidly starting its implementation. Proceed with the speedy implementation of cohesion policy programmes, in close complementarity and synergy with the recovery and resilience plan.2023 CSR 3Limited ProgressBoost labour market participation of women, including by enhancing quality childcare services,Limited ProgressRelevant RRP measures planned as of 2023.SDG 4, 5, 8, 10and of older workers, and improve labour market outcomes for disadvantaged groups, such as low-skilled jobseekers and people with a migrant background, including by raising their levels of basic skills.Limited ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2025. SDG 4, 5, 8, 102023 CSR 4Some ProgressReduce overall reliance on fossil fuels andLimited ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2022. SDG 7, 9, 13diversify gas supply sources to significantly decrease dependence on Russia.Limited ProgressSDG 7, 8, 9Accelerate the deployment of renewable energy and the necessary infrastructure, in particular by simplifying permitting procedures and putting in place dedicated acceleration areas.Some ProgressRelevant RRP measures being implemented as of 2020 and planned as of 2022. SDG 7, 9, 13Improve energy efficiency.Some ProgressRelevant RRP measures being implemented as of 2021 and planned as of 2022. SDG 7, 9, 13Reduce emissions, in particular in the transport sector.Some ProgressRelevant RRP measures planned as of 2023.SDG 7, 9, 13Step up policy efforts aimed at the provision and acquisition of skills and competences needed for the green transition.Some ProgressRelevant RRP measures being implemented as of 2021 and planned as of 2024. SDG 4, 7, 13RRP implementation is monitored through the assessment of RRP payment requests and analysis of the bi-annual reporting on the achievement of the milestones and targets, to be reflected in the country reports. Progress with the cohesion policy is monitored in the context of the Cohesion Policy of the European Union. 
 
  
 
ANNEX 3: RECOVERY AND RESILIENCE PLAN – IMPLEMENTATION 

This  Annex  provides  a  snapshot  of  Austria’s 
implementation of its recovery and resilience 
plan  (RRP),  past  the  mid-way  point  of  the 
Recovery  and  Resilience  Facility’s 
(RRF) 
lifetime.  The  RRF  has  proven  central  to  the  EU’s 
recovery  from  the  COVID-19  pandemic,  helping 
speed  up  the  twin  green  and  digital  transition, 
while  adapting  to  geopolitical  and  economic 
resilience 
developments, 
against  future  shocks.  The  RRF  is  also  helping 
implement the UN Sustainable Development Goals 
and 
country-specific 
recommendations (see Annex 2).   

strengthening 

address 

and 

the 

The  RRP  paves  the  way  for  disbursing  up  to 
EUR 3.96 billion in grants under the RRF over 
the  2021-2026  period, representing  0.8% of 
Austria’s  GDP (35).  As  of  mid-May  2024,  EUR 
1.19  billion  has  been  disbursed  to  Austria  under 
the RRF. 

Austria  still  has  EUR  2.8  billion  available  in 
grants from the RRF. This will be disbursed after 
the  assessment  of  the  future  fulfilment  of  the 
remaining 134 milestones and targets (36) included 
in  the  Council  Implementing  Decision (37)  (CID), 
ahead  of  the  2026  deadline  established  for  the 
RRF.  

Austria’s progress in implementing its plan is 
recorded  in  the  Recovery  and  Resilience 
Scoreboard (38).  The 
scoreboard  gives  an 
overview  of  the  progress  made  in  implementing 
the RRF as a whole. Graph A3.1 shows the current 
state of play as reflected in the scoreboard.  

Austria’s  RRP  includes  a  REPowerEU  chapter 
to phase out its dependency on Russian fossil 
its  energy  supplies,  and 
fuels,  diversify 
produce  more  clean  energy  in  the  coming 
years.  To  kick-start  the  REPowerEU  chapter’s 

(35)  GDP information is based on 2023 data. Source: 

https://ec.europa.eu/economy_finance/recovery-and-
resilience-scoreboard/index.html?lang=en 

(36)  A milestone or target is satisfactorily fulfilled once a Member 
State has provided evidence to the Commission that it has 
reached the milestone or target and the Commission has 
assessed it positively in an implementing decision. 

(37)  https://data.consilium.europa.eu/doc/document/ST-10159-

2021-ADD-1/en/pdf  

implementation,  EUR  42.1  million  was  disbursed 
as  pre-financing  on  21  December  2023.  This 
helped  launch  relevant  reforms  like  streamlining 
permitting  procedures 
renewable  energy 
projects, in particular wind farms. 

for 

The  plan  has  a  strong  focus  on  the  green 
transition,  dedicating  56%  of  the  available 
funds  to  measures  that  support  climate 
objectives and 36% of its total allocation to 
support  the  digital  transition.  It  also  retains  a 
strong  social  dimension  with  social  protection 
measures,  especially  related  to  education  and 
skills,  healthcare,  business  environment  and 
research and innovation.    

Table A3.1:  Key facts of the Austrian RRP 

Source: RRF Scoreboard 

its  RRP 

implementation  of 
timely 

With 1 complete payment request completed, 
is 
Austria’s 
underway.  However, 
completion 
requires  increased  efforts.  The  Commission 
gave  a  positive  assessment  of  Austria’s  payment 
request on 10 March 2023, taking into account the 
opinion of the Economic and Financial Committee. 
This  led  to  EUR  700  million  being  disbursed  in 
financial support on 20 April 2023 (39). The related 
44  milestones  and  targets  covered  reforms  and 
investments  such  as  the  entry  into  force  of  a 
Renewable  Expansion  Law,  which  will  accelerate 
the  roll-out  of  renewable  energy  production,  and 
others in the areas of public transportation, energy 
efficiency and digitalisation of schools.  

(38)  https://ec.europa.eu/economy_finance/recovery-and-

resilience-scoreboard/country_overview.html 

(39)  When requested payments are disbursed, the pre-financing 
is cleared proportionally. The net amounts are quoted here. 

27 

Initial plan CID adoption date13 July 2021Scope Revised plan with REPowerEU chapterLast major revision9 November 2023Total allocation EUR 3.96 billion in grants (0.8% of 2023 GDP)Investments and reforms 34 investments and 29 reforms Total number of milestones and targets178Fulfilled milestones and targets44 (24.7% of total) 
 
 
 
   
 
 
 
Graph A3.1: Total grants disbursed under the RRF 

Note: This graph displays the amount of grants, including pre-
financing, disbursed so far under the RRF. Grants are non-
repayable financial contributions. The total amount of grants 
given to each Member State is determined by an allocation 
key and the total estimated cost of the respective RRP. 
Source: RRF Scoreboard 

As  of  15  May  2024,  Austria  is  working 
towards  its  second  payment  request.  Table 
A3.2  highlights  some  relevant  measures  achieved 
so far, and some that will be implemented before 
2026  to  keep  making  Austria’s  economy  greener, 
more digital, inclusive, and resilient.   

Table A3.2:  Measures in Austria's RRP 

Source: FENIX 

28 

EUR 1.19billion (30%)Total allocation: EUR 3.961billionReforms and investments implemented• Introduction of 1-2-3 climate ticket• Eco-social tax reform• Exchange of oil and gas heating systemsUpcoming reforms and investments• Reform of the long-term care system• Cultural and art objects digitalisation programme• Start-up package 
   
 
   
 
ANNEX 4: OTHER EU INSTRUMENTS FOR RECOVERY AND GROWTH 

EU funding instruments provide considerable 
resources for recovery and growth to the EU 
Member  States.  In  addition  to  the  EUR  3.96 
billion  of  Recovery  and  Resilience  Facility  (RRF) 
funding  described  in  Annex  3,  EU  cohesion  policy 
funds (40) provide EUR 1.1 billion to Austria for the 
2021-2027 period (41).  Support  from  these  two 
instruments combined represents around 1.05% of 
the  country’s  2023  GDP,  compared  to  the  EU 
average  of  5.38%  of  GDP (42).  Cohesion  policy 
supports  regional  development,  economic,  social 
and  territorial  convergence  and  competitiveness, 
through  long-term  investment  in  line  with  EU 
priorities and with national and regional strategies. 

During  the  2014-2020  programming  period, 
cohesion  policy  funds  boosted  Austria’s 
competitiveness, with  tangible achievements 
notably  in  research  and  innovation,  energy 
efficiency,  renewable  energy,  education  and 
skills.  By  the  end  of  the  eligibility  period  in 
December  2023,  2014-2020  cohesion  policy 
funds (43)  had  made  EUR  1.3  billion  available  to 
Austria (44),  of  which  EUR  762.4  million  has  been 
disbursed  since  March  2020,  when  the  COVID-19 
pandemic  began (45).  The  achievements  of 
cohesion  policy  funds  over  the  programming 
period  included  the  support  provided  to  develop 
research  and 
infrastructure  and 
projects,  which  have  created  more  than  400  new 
research  jobs  so  far.  A  total  of  780  businesses 
have  received  financing,  mainly  for  productive 
investments  and 
increasing  energy  efficiency, 
which  has  triggered  more  than  EUR  1.4  billion  of 
private investments. Support for increasing energy 

innovation 

(40)  In 2021-2027, cohesion policy funds include the European 
Regional Development Fund, the European Social Fund Plus 
and the Just Transition Fund. 

(41)  European territorial cooperation (ETC) programmes are 
excluded from the figure. In 2021-2027, the total 
investment, including national financing, amounts to EUR 2.9 
billion.  

(42)  RRF funding includes both grants and loans, where 

applicable. The EU average is calculated for cohesion policy 
funds excluding ETC programmes. GDP figures are based on 
Eurostat data for 2022. 

(43)  In 2014-2020, cohesion policy funds included the European 
Regional Development Fund and the European Social Fund. 
REACT-EU allocations are included but ETC programmes are 
excluded. 

(44)  In 2014-2020, the total investment, including national 

financing, amounted to EUR 3.6 billion.  

(45) Cut-off date: 14 May 2024. 

efficiency  and  using  renewable  energies  has 
resulted in an annual decrease of greenhouse gas 
emissions  of  124  000  tonnes  of  CO2  equivalent. 
During the same period, more than 109 000 young 
people in Austria received support under measures 
implemented  under  the  European  Social  Fund 
(ESF), with EUR 265.4 million allocated to prevent 
early  school  living. Moreover,  more  than  313  000 
participants  had  been  reached  with  ESF-funded 
measures,  including  support  provided  to  people 
furthest 
to  gain 
from 
qualifications and get jobs. 

labour  market 

the 

In  the  current  programming  period  (2021-
2027),  cohesion  policy will  provide a  further 
boost  to  Austria’s  competitiveness,  to  the 
green  transition  and  to  social  cohesion, 
improving  the  living  and  working  conditions 
of Austria’s people. In 2021-2027, the European 
Regional  Development  Fund  (ERDF)  will  increase 
the  efficiency  and  economic  exploitation  of 
scientific  performance  and  boost  productivity  by 
supporting  research  and  innovation  equipment, 
benefiting  741  researchers.  Support  for  energy 
efficiency  measures  in  businesses  and  municipal 
bodies  will  reduce  greenhouse  gas  emissions  by 
almost 270 000 tonnes of CO2 equivalent/year. By 
investing  in  SMEs  and  strengthening  the  start-up 
environment,  the  Just  Transition  Fund  (JTF)  will 
promote  diversification  towards  sustainable  and 
innovation-driven  economic  activities  in  line  with 
the  Green  Deal’s  objectives.  For  this  to  work,  the 
JTF  will  support  60  businesses  and  create 
incubation capacity for 29 businesses. This will be 
complemented  by  JTF  support  to  research  and 
innovation projects that enable a transition to low- 
and  zero-emission  technologies,  benefiting  210 
researchers. The European Social Fund Plus (ESF+), 
with  a  budget  totalling  EUR  393  million,  will 
provide  EUR  128  million  to  implement  measures 
that  aim  to  improve  educational  outcomes  to 
prevent  early  school  leaving,  in  particular  for 
students  who  struggle  at  school  (especially  those 
students  from  a  disadvantaged  socio-economic 
background  or  a  migrant  background),  with 
support  from  the  ESF+.  In  the  field  of  social 
inclusion,  EUR  114  million  of  ESF+  funds  will  be 
used  to  fund  measures  to  support  labour  market 
integration  and  promote  active  inclusion  including 
of  people  with  disabilities.  The  JTF  also  invests 
some  EUR  60  million  in  ESF+  type  measures,  e.g. 
i) establishing  an  eco-tech  academy;  ii)  delivering 
training 
sustainability, 
environmental 
photovoltaics  and  e-mobility;  and  iii)  providing 
targeted  career  guidance and  green  skills  support 

in 

29 

 
 
 
 
 
project;  ii) promoting  the  TSI  flagship,  ‘Renovation 
Wave’, by advancing building decarbonisation; and 
iii) raising  the  quality  and  equity  of  school 
education  in  Austria  by  strengthening  human 
resources  planning  and  policies  for  the  teaching 
profession. The TSI is also helping Austria boost its 
overall capacity to integrate the 'do no significant 
harm' 
funding 
programmes related to its RRP and environmental 
aspects into public finances. 

(DNSH)  principle 

into  public 

Graph A4.2: Distribution of RRF funding by pillar in 
Austria 

(1) Each RRP measure helps achieve the aims of two of the 
six policy pillars of the RRF. The primary contribution is shown 
in the outer circle while the secondary contribution is shown in 
the inner circle. Each contribution represents 100% of the RRF 
funds. Therefore, the total contribution to all pillars displayed 
on this chart amounts to 200% of the RRF funds allocated to 
Austria. 
Source: European Commission 

Austria  also  receives  funding  from  several  other 
EU  instruments,  including  those  listed  in  Table 
A4.1. 

to  employers.  With  this  work,  cohesion  policy 
contributes  to  achieving  the  UN  Sustainable 
Development Goals (SDGs) in Austria, in particular 
SDG 8 (Decent work and economic growth), SDG 9 
(Industry,  innovation,  infrastructure)  and  SDG  1 
(No poverty). 

Graph A4.1: Distribution of cohesion policy funding 
across policy objectives in Austria 

Source: European Commission 

Through combined action, cohesion policy and 
the recovery and resilience plan (RRP) have a 
mutually  reinforcing  impact  in  Austria.  For 
instance,  the  ERDF  supports  start-up  services 
throughout  the  country’s  regions,  e.g.  services  to 
coach  knowledge-intensive  start-ups  and  provide 
incubation  capacities.  This  is  complemented  by  a 
reform implemented as part of the RRP that helps 
start-ups in the early stages of operations, e.g. by 
introducing  a  new  legal  form  for  start-ups  and 
In  addition, 
examining  further  tax 
cohesion  policy  and  the  RRP  together  increase 
energy  efficiency  to  help  Austria  achieve  its 
ambitious  objective  to  already  become  climate 
in  2040.  The  Austrian  ERDF & JTF 
neutral 
programme  helps  businesses  and  municipalities 
improve  their  energy  efficiency,  while  the  RRP 
finances  major  projects  in  large  businesses  and 
Emissions  Trading  System  installations  so  they 
can,  for  example,  switch  to  renewable  energies. 
The  contribution  of  cohesion  policy  and  RRP 
funding by policy objective is illustrated by Graphs 
A4.1 and A4.2. 

incentives. 

The Technical Support Instrument (TSI) helps 
Austria  invest  in  its  public  administration 
and create a better enabling environment for 
EU  and  national  investment.  The  TSI  has 
funded  projects 
to  design  and 
in  Austria 
implement  growth-enhancing reforms since 2018. 
The support provided under the TSI 2023 included: 
i) strengthening 
tax  compliance  by  providing 
behavioural  insights  for  revenue  administration 
through  the  implementation  of  a  multi-country 

30 

PO1 Smarter EuropePO2 Greener EuropePO4 Social EuropePO5 Europe closer to citizensPO8 JTF specific objectiveGreen transitionDigital transformationSmart, sustainable and inclusivegrowthSocial & territorial cohesionHealth & resilienceNext generation 
   
   
Table A4.1:  Support from EU instruments in Austria 

(1) RRF implementation period is 2021-2026. 
(2) The public sector loan facility’s programming period is 2021-2025 and the amount reflects the national share in its grant 
component reserved until the end of the period.   
(3) Common agricultural policy programming periods are 2014-2022 and 2023-2027.   
(4) EMFF – European Maritime and Fisheries Fund, EMFAF – European Maritime, Fisheries and Aquaculture Fund. 
(5) Data on the Connecting Europe Facility covers transport and energy and has a cut-off date of 15 May 2024. 
(6) Data on Horizon Europe (2021-2027) has a cut-off date of 13 May 2024. 
(7) 2021-2027 data on the LIFE programme has a cut-off date of 15 May 2024. 
(8) The amount of the EU guarantee signed under the EFSI Infrastructure and Innovation Window was derived based on the 
signed amount of the operations and the average internal multiplier, as reported by the EIB (cut-off date is 31 December 2023). 
(9) The amount of the EU guarantee and of the volume of operations signed under InvestEU includes the EU compartment as well 
as the Member State compartments (cut-off date is 31 December 2023). 
Source: European Commission 

31 

Amount 2021-2027 (EUR million)Cohesion policy1 066.8RRF grants (1)3 961.2Public sector loan facility (grant component) (2)10.3Common agricultural policy (3)6 084.0EMFF/EMFAF (4)6.7Connecting Europe Facility (5) 238.9Horizon 2020 / Horizon Europe (6)1 027.9LIFE programme (7) 91.6Volume of operations (EUR million)European Fund for Strategic Investment 2015-2020 (8)1 978.1InvestEU 2021-2027 (9) 204.711 100.0EU grantsAmount 2014-2020 (EUR million)1 250.2-- 643.0 67.27.0 962.71 959.557.8EU guaranteesEU Guarantee (EUR million) 
 
   
 
ANNEX 5: RESILIENCE 

Table A5.1:  Resilience indices across dimensions for Austria and the EU-27 

(1)  The synthetic indices aggregate the relative resilience situation of countries across all considered indicators. For an indicator, 
each country’s relative situation in the latest available year is compared with the collection of values of that indicator for all 
Member States and all years in the reference period. 
Source: Resilience Dashboards - version spring 2024, data up to 2022 

This  Annex  uses  the  Commission’s  resilience 
(RDB) (46)  to  show  Austria’s 
dashboards 
relative 
and 
resilience 
vulnerabilities (47)  that  may  be  of  relevance 
for  societal,  economic,  digital  and  green 
transformations, and for dealing with future 
shocks and geopolitical challenges. (48)  

capacities 

According  to  the  RDB’s  set  of  resilience 
indicators,  Austria  has  medium  overall 
vulnerabilities  and  medium-high  overall 
capacities,  both  of  which  have  remained 
stable  with  respect  to  the  2023  RDB.  This  is 
reflected  in  the  distribution  of  indicators  across 
different  resilience  categories:  more  than  60%  of 
capacity indicators are medium-high or high, while 
about 70% of vulnerability indicators are between 
medium  and  low.  With  respect  to  the  2023  RDB, 

(46)  Https://ec.europa.eu/info/strategy/strategic-

planning/strategic-foresight/2020-strategic-foresight-
report/resilience-dashboards_en. Resilience is defined as the 
ability not only to withstand and cope with challenges but 
also to undergo transitions, in a sustainable, fair, and 
democratic manner. 2020 Strategic Foresight Report: 
Charting the course towards a more resilient Europe 
(COM(2020) 493). 

(47)  Vulnerabilities describe features that can exacerbate the 

negative impact of crises and transitions, or obstacles that 
may hinder the achievement of long-term strategic goals, 
while capacities refer to enablers or abilities to cope with 
crises and structural changes and to manage transitions. 

(48)  This Annex is linked to Annex 1 on SDGs, Annex 6 on the 
green deal, Annex 8 on the fair transition to climate 
neutrality, Annex 9 on resource productivity, efficiency and 
circularity, Annex 10 on the digital transition and Annex 14 
on the European pillar of social rights. 

32 

Austria’s  indicators  for  its  aggregate  resilience 
situation have neither improved nor worsened.  

Austria  has  medium-low  vulnerabilities  and 
medium-high  capacities  in  the  social  and 
economic  dimension.  The  country  has  improved 
from  the  previous  year 
in  the  vulnerability 
indicators  for  its  gender  employment  gap  and 
long-term  unemployment 
rate.  Vulnerability 
related to government debt remains medium-high. 
Capacity 
indicators  that  have  worsened  with 
respect to the previous year include the impact of 
social 
the 
household  saving  rate,  and  the  government 
investment  to  GDP  ratio.  Conversely,  there  has 
been  an  improvement  in  the  employment  rate, 
active  labour  market  policies  per  person  wanting 
to  work  and  the  absolute  number  of  healthy  life 
years at birth. 

transfers  on  poverty 

reduction, 

In 
the  green  dimension,  Austria  has 
maintained its high capacities, but its overall 
vulnerabilities  have  not  improved,  remaining 
medium-high.  The  farmland  bird 
index,  soil 
erosion by water, and harmonised risk indicator 1 
for pesticides are the high vulnerability indicators. 
At  the  same  time,  Austria  has  very  low  water 
exploitation vulnerabilities, putting it last in the EU. 
It  has  strong  capacities,  including  its  energy 
productivity,  and  performs 
the 
indicators related to organic farming and national 
expenditure on environmental protection. 

the  best 

in 

With  respect  to  the  2023  RDB,  Austria  has 
maintained  medium  vulnerabilities  and 
the  digital 
medium-high 

capacities 

in 

ATATEU-272023 RDB2024 RDB2024 RDBHighMedium-highMediumMedium-lowLowHighMedium-highMediumMedium-lowLowDimensionDistribution of indicators by vulnerabilities and capacitiesOverall resilienceVulnerabilities0.540.510.50Capacities0.710.720.67VulnerabilitiesSocial and economicVulnerabilities0.670.700.47Capacities0.790.770.670.630.680.65GreenVulnerabilities0.360.380.44Capacities0.850.860.70CapacitiesGeopoliticalVulnerabilities0.520.400.41Capacities0.610.590.65DigitalVulnerabilities0.510.540.52Capacities0%20%40%60%80%100%Vulnerabilities(60 indicators)Capacities(64 indicators) 
 
 
 
   
 
 
dimension.  Many  of  its  capacity  indicators  have 
improved, putting it first in the EU for investment 
per  employee  in  high-technology  sectors.  It  also 
has  medium-high  capacities  in  the  use  of  online 
courses  and  online  learning  activities  by  young 
people.  Vulnerability  indicators  where  Austria  is 
below the  EU  average  are  cybersecurity incidents, 
lack  of  cloud  services,  the  number  of 
the 
and 
businesses 
communication (ICT) training programmes, and the 
broadband access gap by company size. 

information 

without 

vulnerabilities 

In  the  geopolitical  dimension,  Austria  has 
medium 
and  medium 
capacities.  Compared  to  previous  years,  several 
of its capacity indicators, such as its intra-EU trade 
in  energy  and  its  extra-EU  trade  openness,  have 
improved.  Looking  at  its  vulnerabilities,  Austria  is 
behind  other  EU  countries  in  terms  of  its  metal 
footprint per capita with a worsening of the rate of 
decline in its per capita metal footprint. 

33 

 
ENVIRONMENTAL SUSTAINABILITY 
ANNEX 6: EUROPEAN GREEN DEAL 

Austria  has  made  progress  in  the  green 
transition,  with  more  action  needed  on 
specifying  the  policies  to  attain  its  2030  effort 
sharing  target,  addressing  potential  losses  from 
climate  hazards,  protection  of  biodiversity  and 
ecosystems,  and  other  areas.  This  Annex  provides 
a  snapshot  of  climate,  energy,  and  environmental 
aspects of the transition in Austria (49). 

this  plan 

for  assessment  by 

Austria  has  not  yet  submitted  a  draft 
updated  national  energy  and  climate  plan 
(NECP) for 2021-2030. It is crucial that Austria 
submit 
the 
Commission,  outlining  how  it  will  meet  the  2030 
climate  and  energy  targets  and  the  objectives  of 
the  Energy  Union.  To  ensure  that  the  policies  and 
measures  required  to  reach  the  2030  targets  are 
implemented  effectively,  a  detailed  mapping  of 
investment  needs  against  available  sources  of 
funding is key.  

to 

Austria  has  not  yet  provided  information  on 
the  policies  and  measures  to  bring  down 
effort  sharing  emissions 
its  2030 
target (50).  In  2022,  Austria’s  greenhouse  gas 
emissions  from  its  effort  sharing  sectors  are 
levels (51). 
expected  to  be  19%  below  2005 
Current  policies  are  projected  to  reduce  Austria’s 
effort sharing emissions by 27% from 2005 levels 
by  2030,  but  information  on  additional  policies 
and  measures  to  achieve  further  reductions  is 

(49)  This Annex is complemented by Annex 7 on energy transition 

and competitiveness, Annex 8 on the fair transition to 
climate neutrality, Annex 9 on resource efficiency, circularity, 
and productivity, and relevant topics in other annexes to this 
country report. 

(50)  The national greenhouse gas emission reduction target is 
laid down in Regulation (EU) 2023/857 (the Effort Sharing 
Regulation). The aim is to align action in the sectors 
concerned with the objective to reach the EU-level economy 
wide target of greenhouse gas reductions of at least 55% 
compared to 1990 levels. The target also applies to the 
sectors outside the current EU Emissions Trading System, 
notably buildings (heating and cooling), road transport, 
agriculture, waste, and small industry (known as the effort 
sharing sectors).  

(51)  The effort sharing emissions for 2022 are based on 
approximated inventory data. The final data will be 
established in 2027 after a comprehensive review. The 
information on projections of effort sharing emissions ‘with 
existing measures’ (WEM) and ‘with additional measures’ 
(WAM) is based on the latest data that had to be reported by 
15 March 2023 under Article 18 of Regulation 2018/1999 
(the Governance Regulation). 

reduction  compared 

lacking. This leaves a gap of 21 percentage points 
below  Austria’s  effort  sharing  target  to  achieve  a 
48% 
levels, 
highlighting the importance for the country to plan 
more  ambitious  policies  and  measures  in  its  final 
updated NECP, due on 30 June 2024.  

to  2005 

Graph A6.1: Greenhouse gas emissions from the 
effort sharing sectors in Mt CO2eq, 2005-2022 

Source: European Environment Agency 

is  scope  for 

There 
increasing  Austria’s 
targets  for  renewable  energy  and  energy 
efficiency 
the 
contribution  set  out  in  its  previous  NECP  are  not 
aligned  with  the more  ambitious  EU  2030 energy 
targets.  

its  updated  NECP,  as 

in 

Austria’s  transport  mix  is  relatively  evenly 
balanced between road and rail, and its shift 
to  sustainable  road  transport  is  gaining 
momentum (52). In 2022, battery electric vehicles 
accounted  for  2.1%  of  Austria’s  passenger  car 
fleet,  significantly  higher  than  the  EU  average  of 
1.2%.  In  2023,  around  19 600  publicly  accessible 
charging points provided a charging point for every 
eight  e-vehicles,  above  the  EU  average  of  1:10. 
Car  trips  account  for  75%  of  the  distances 
travelled  (EU  average:  85%),  while  rail  accounts 
for  9%  (EU  average:  6%).  For  freight,  road 
transport  accounts  for  a  smaller  proportion  of 
tonnes  transported  than  the  EU  average  (62%  vs 
75%),  with  a  remarkable  27%  of  freight  being 
transported by rail (53), and 10% through pipelines. 

(52)  Unless otherwise indicated, data in this section refer to 
2021. See European Commission, 2023, EU transport in 
figures, transport.ec.europa.eu. 

(53)  Austria has a proactive modal shift policy, with road tolls for 
road freight transport and subsidies and support for a 
combined transport mode for rail freight transport. 

34 

010203040506020052022MtCO2eWasteSmall industryAgricultureBuildings (under ESR)Domestic transport (excl. aviation) 
 
 
 
      
 
 
 
71%  of  Austria’s  railway  network  is  electrified 
(significantly above than the EU average of 56%).  

to 

from 

remove  carbon 

Austria  has  the  potential  to  increase  its 
capacity 
the 
atmosphere  through  land  use,  land  use  change 
and forestry (LULUCF). Its forests play a major role 
in  carbon  removals.  In  2018,  Austria's  land  use 
sector  transitioned  from  removing  carbon  to 
emitting it, but the country has been achieving net 
removals  since  2020.  To  reach  its  2030  LULUCF 
target, additional carbon removals of 879 kt CO2eq 
are needed (54). 

these 

Austria’s wide climate protection gaps (55) for 
floods  and  wildfires  call  for  monitoring. 
risks  are 
losses  from 
Damages  and 
projected to rise to at least EUR 3-6 billion in 2030 
and  EUR  6-12  billion  by  2050.  A  relatively  large 
share of assets remains uninsured against climate 
hazards.  Austria  is  also  vulnerable  to  climate 
change-related impacts due to more frequent and 
extreme  weather  events 
like  heatwaves  and 
droughts.  Adapting  to  these  impacts  will  require 
substantial  additional  precautionary  measures, 
notably  on  the  resilience  of  forests,  biodiversity, 
infrastructure,  construction 
through 
nature-based  solutions), 
transport,  agriculture, 
tourism  and  human  health 
(hydro)energy, 
protection (56). 

(including 

Despite  clear  improvements  in  conservation 
and restoration, the status of many habitats 
and  species  has  continued  to  deteriorate. 
Austria  protects  29%  of  its  land.  However,  only 
18%  of  habitats  and  nearly  15%  of  species  were 
in  a  favourable  condition.  The  largest  decline  in 
biodiversity  has  been  reported  in  agricultural 
landscapes.  At  the  same  time,  the  common 
farmland  birds  index  slowly  increased  from  55  in 
2018  to  63  in  2020,  which  is  still  below  the  EU 
average. More positively, Austria’s uptake of green 
infrastructure in urban and commuting areas is at 
a  good  level.  Its  biodiversity  strategy  includes 
targets  for  increasing  grasslands  in  urban  areas, 
repurposing abandoned buildings and the provision 

(54)  National LULUCF targets of the Member States in line with 

Regulation (EU) 2023/839. 

(55)  On the climate protection gap, see the annotations to Table 

A6.1. 

of  features  that  promote  biodiversity  in  newly 
established  green  areas.  According  to  European 
Environmental  Agency  data  for  Austria’s  six  main 
cities, the average tree coverage stood at 36.5% in 
2018 (above the EU average of 30.3%). 

Graph A6.2: Changes in livestock density and 
organic farming 

Livestock unit (LSU)/ha of UAA: it measures the stock of 
animals (cattle, sheep, goats, equidae, pigs, poultry and 
rabbits) converted in LSUs per hectare of UAA. 
Source: Eurostat 

stark 

Ammonia emissions from agriculture are still 
high  and  additional  efforts  could  help 
meeting emission reduction targets set under 
the  NEC-Directive.  The  annual  output  of  the 
Austrian  agricultural  sector  was  worth  EUR  7.3 
billion (57) in 2023. Austria has the largest share of 
organic  farming  in  the  EU  -  25.7%  of  its  total 
in  2021  (EU 
utilised  agricultural  area  (UAA) 
average  9.1%).  There  are 
regional 
differences  in  Austria’s  livestock  farming  sector, 
with  some  areas 
intensifying  production  and 
livestock  abandonment  occurring  in  other  areas. 
This  situation  puts  certain  ecosystems  at  risk. 
Overall,  while  most  EU  Member  States  lowered 
their  livestock  density  indices  between  2010  and 
2020,  Austria  reported  a  marginal  increase  from 
0.85%  to  0.86% (58).  Intensive  animal  farming  is 
one of the main causes of emissions of pollutants 
such  as  ammonia.  The  agricultural  sector  was 
responsible for 93.1% of total ammonia emissions 
(EU average: 90.9%). Additional efforts could help 
meeting  emission  reduction  targets  set  under  the 
NEC-Directive  as  described  in  Austria's  updated 
2023  National  Air  Pollution  Control  Programme 

(56)  See the Commission’s 2023 assessment and 

recommendation on Austria’s progress on climate 
adaptation. 

(57)  Production value at basic price (2015=100).   

(58)  After a peak of 0.95% in 2016.  

35 

01205101520253020162020% LSU per hectare% of total utilised agricultural areaLivestock density index Austria (% LSU per ha)Livestock density index EU-27 (% LSU per ha)Organic farming Austria (% of total utilised agricultural area)Organic farming EU-27 (% of total utilised agricultural area) 
 
       
 
Graph A6.3: Environmental investment gap, annual 
average 

The numbers are computed by the European Commission 
based on the latest internal reports, Eurostat, EIB and national 
data sources. 
Source: European Commission 

Austria would benefit from investing more in 
measures to protect biodiversity and address 
pollution.  According  to  the  latest  estimates,  the 
overall environmental investment needs for 2021-
2027  reach  at  least  EUR  10.4  billion  per  year, 
while  the  financing  baseline  stands  at  EUR  7.3 
billion. The resulting gap of EUR 3.1 billion is wider 
than  in  the  previous  financing  period.  There 
remains  an  opportunity  to  increase  funding,  in 
particular for pollution prevention and control (EUR 
1.4  billion  per  year)  and  sustainable  water 
management  (EUR  533  million  per  year).  Austria 
would  also  benefit  from  investing  in  circular 
economy  and  waste  and  biodiversity  and 
ecosystems, where the gaps increased to EUR 715 
million and EUR 626 million respectively.  

(NAPCP).  According  to  the  impact  assessment  for 
the  Soil  Monitoring  Law (59),  26%  of  Austria’s  soil 
could  be  considered  as  unhealthy (60).  Soil  erosion 
affects 68% of cropland, while the loss of organic 
carbon  affects  47%  of  cropland  and  grassland. 
Austria  had  one  of  the  lowest  shares  of  irrigated 
land, accounting for 1.4% of its total UAA, most of 
it  located  in  the  north-east  of  the  country.  The 
for  agricultural  purposes 
water  abstracted 
accounted for only 0.8% of total water abstraction 
in 2019, almost double that of the previous year. 
Austria produced 134 kg of food waste per person 
in 2021, above the EU average of 131. 

Nutrients  pollution  in  Austria’s  waterbodies 
is higher than the EU average. According to the 
latest  figures  on  gross  nitrogen  balance  on 
agricultural  land,  Austria  has  an  average  surplus 
of  34.1 kg  of  nitrogen  per  hectare  per  year,  but 
this  surplus  has  been  steadily  decreasing.  The 
content  of  nitrate  in  groundwater  decreased  over 
time  but  still  exceeds  the  EU  average  of  20.5 mg 
nitrate/l.  Moreover,  7.2% 
groundwater 
monitoring  stations  showed  levels  above  the 
maximum of 50 mg nitrate/l over 2016-2019. The 
gross  phosphorus  balance  has  also  been 
decreasing  and  stands  at  1.3 kg/ha  according  to 
the  latest  annual  data.  Water  pollution  from 
pesticides  is  less  concerning  in  Austria  than  in 
other EU countries and no surface monitoring sites 
were reported to exceed the thresholds set by the 
Water Framework Directive in 2021.   

of 

Air  quality  in  Austria  is  generally  good,  with 
some  exceptions.  The  number  of  years  of  life 
lost  due  to  exposure  to  pollutants  such  as  PM2.5 
and  NO2  were  below  the  EU  average  in  2020,  at 
inhabitants 
362  and  95  years  per  100 000 
respectively. 
emission 
smog-precursor 
intensity  decreased  by  32.9%  between  2008  and 
2021,  reaching  0.43  thousand  tonnes/EUR 10  (EU 
average: of 0.86).  

The 

(59)  SWD 417 final of 05.07.2023  - impact assessment for the 
Directive of the European Parliament and of the Council on 
Soil Monitoring and Resilience (Soil Monitoring Law), (cfr. pg. 
10, pg. 189-190, pg. 835-845). 

(60)  However, not all soil degradation processes could be 

quantified for all land uses. This number simply indicates an 
order of magnitude.  

36 

8871206965691,43553371562602004006008001,0001,2001,4001,6001,800Pollution prevention &controlWater managementCircular economy andwasteBiodiversity andecosystemsmillion EUR2014-20202021-2027 
 
       
 
 
 
 
 
 
 
 
Table A6.1:  Indicators tracking progress on the European Green Deal from a macroeconomic perspective 

Sources:  (1)  Member  States’  emission  data  for  2019  and  2020  are  in  global  warming  potential  (GWP)  values  from  the  4th 
Assessment Report (AR4) of the Intergovernmental Panel on Climate Change (IPCC). Member States’ 2005 base year emissions 
under  Regulation  (EU)  2018/842,  emissions  data  for  2021  and  2022,  and  2030  projections  are  in  GWP  values  from  the  5th 
Assessment Report (AR5) of the IPCC. 2021 data are based on the final inventory reports, 2022 data are based on approximated 
inventory reports and European Environmental Agency’s calculation of effort sharing emissions. The final data for 2021 and 2022 
will  be  established  after  a  comprehensive  review  in  2027.  The  2030  target  is  in  percentage  change  of  the  2005  base  year 
emissions. Distance to target is the gap between the 2030 target and projected effort sharing emissions with existing measures 
(WEM) and with additional measures (WAM), in percentage change from the 2005 base year emissions. The measures included 
for  the  2030  emission  projections  reflect  the  state  of  play  as  reported  in  Member  States'  draft  updated  national  energy  and 
climate plans or, if unavailable, as reported by 15 March 2023 as per Regulation 2018/1999. (2) Net removals are expressed in 
negative figures, net emissions in positive figures. Reported data are from the 2024 greenhouse gas inventory submission. 2030 
value  of  net  greenhouse  gas  removals  as  in  Regulation  (EU)  2023/839  –  Annex  IIa.  (3)  The  2030  national  objectives  for 
renewable  energy  and  energy  efficiency  are  indicative  national  contributions,  in  line  with  Regulation  (EU)  2018/1999  (the 
Governance  Regulation),  the  EU-level  2030  renewable  energy  target  set  out  in  Directive  EU/2018/2001  amended  by  Directive 
EU/2023/2413 (the revised Renewable Energy Directive) – 42.5% of gross final energy consumption with the aspiration to reach 
45% –, and the formula in Annex I to Directive (EU) 2023/1791 (the Energy Efficiency Directive). (4) Passenger battery electric 
vehicles (BEV) and fuel cell electric vehicles (FCEV). (5) The climate protection gap refers to the share of non-insured economic 
losses caused by climate-related disasters, based on modelling of the risk from floods, wildfires, windstorms, and the insurance 
penetration rate. Scale: 0 (no protection gap) –4 (very high gap) (European Insurance and Occupational Pensions Authority, 2022). 
(6) Total water consumption in renewable freshwater resources available for a territory and period. (7) Material extractions  for 
consumption and investment. (8) Years of potential life lost through premature death due to exposure to particulate matter with a 
diameter  of  less  than  2.5  micrometres.  (9)  Share  of  habitats  in  good  conservation  status  according  to  the  records  submitted 
under  Art.  17  of  the  Habitats  Directive  (Directive  92/43/EEC)  for  2013-2018.  (10)  Multi-species  index  measuring  changes  in 
population abundances of farmland bird species. (11) Source: annex 12 of the Commission’s proposal for a soil monitoring law, 
SWD (2023) 417 final. (12) Estimates of organic carbon content in arable land. 

37 

Target200520192020202120222030WEMWAMProgress to climate and energy policy targetsGreenhouse gas emission reductions in effort sharing sectors (1)Mt CO2eq, %, pp56,992.0-12%-18%-14%-19%-48%-21-21Net greenhouse gas removals from LULUCF (2)Kt CO2eq-18 0992 437-5 843 -11 076 -4 474-5,650n/an/aShare of energy from renewable sources (1) (3)%24%34%37%35%34%0.57--Energy efficiency: primary energy consumption (3)Mtoe32.732.329.931.630.224.9Energy efficiency: final energy consumption (3)Mtoe27.928.326.127.926.321.612Projected20182019202020212022202120222030Green transition: mobility         Greenhouse gas emissions: road transportMt CO2e---21.520.3769.0786.618.8Share of zero-emission vehicles in new registrations (4)% 22.86.413.915.7912.1n/aNumber of publicly accessible AC/DC charging points --85871173717455299178446956n/aShare of electrified railways%71.5%70.8%71.2%71.4%-56.1%-n/aGreen transition: buildings         Greenhouse gas emissions: buildingsMt CO2e---10.18.6537.0486.77.4Final energy consumption in buildings2015=100100.0%102.4%103.1%114.2%100.6%104.0%97.2% Climate adaptation         Climate protection gap (5)score 1-4--2.01.61.51.51.5n/a20182019202020212022202020212022State of the environmentWater | Water exploitation index (WEI+) (1) (6)% of renewable freshwater1.90.1---3.6--Circular economy | Material footprint (7)tonnes per person23.923.522.724.723.514.214.814.9Pollution | Years of life lost due to air pollution by PM2.5 (8)per 100.000 inhabitants591429344362-545584-Biodiversity | Habitats in good conservation status (9)%18.014.7                       Common farmland bird index (10)2000=100556263--78--Green transition: agri-food sectorOrganic farming% of total utilised agricultural area24.0825.3325.69--9.1--Nitrates in groundwatermg NO3/litre-----20.42--Food waste per capitaKg per capita136134-130131-Share of soil in poor health (11)%2641Soil organic matter in agricultural land (12)Mt per ha232----7,904--DistanceEU-27 
 
       
 
ANNEX 7: ENERGY TRANSITION AND COMPETITIVENESS 

This  Annex (61)  sets  out  Austria’s  progress 
and  challenges  in  accelerating  the  net-zero 
energy  transition  while  bolstering  the  EU’s 
competitiveness 
energy 
sector (62).  

clean 

the 

in 

year’s 

Austria  made  some  steps  in  implementing 
reforms  to  accelerate  the  deployment  of 
increase, 
last 
renewables  but 
particularly  in  solar  photovoltaics,  is  still 
below  the  EU  average.  Austria  aims  to  reduce 
its  current  import  dependencies  through  trustful 
partnerships, but it still imports gas from Russia. It 
has  implemented  a  series  of  energy  efficiency 
measures with the support of several EU funds. In 
clean  energy  technologies  manufacturing,  Austria 
has  presence  in  the  solar  industry  and  in  the 
supply chain for battery manufacturing, with great 
potential for increasing capacity further. 

Energy  retail  prices  in  gas  and  electricity 
have exhibited a mixed evolution throughout 
2023 in Austria. In the second half of 2023, the 
average gas price for households was reduced by 
5.5%  compared  to  the  beginning  of  the  year  but 
remained  31%  above  EU  average.  Regarding 
average electricity prices, households saw a 3.6 % 
increase in 2023 but reaching a level  still slightly 
below EU average. For industrial consumers in the 
second  half  of  2023,  average  gas  and  electricity 
prices  declined  by  22%  and  5%  respectively, 
compared  to  the  first  semester  of  the  year,  both 
remaining below EU average.  

Graph A7.1: Austria's energy retail prices for 
households and industry & service 

(1) For industry, consumption bands are I3 for gas and IC for 
electricity, which refer to medium-sized consumers and 
provide an insight into affordability 
(2) For households, the consumption bands are D2 for gas 
and DC for electricity 
(3) Industry prices are shown without VAT and other 
recoverable taxes/levies/fees as non-household consumers 
are usually able to recover VAT and some other taxes 
Source: Eurostat 

consumers 

In  relative  terms,  electricity  prices  for  non-
household 
increased 
significantly  compared  to  the  US  and  Japan, 
thus  potentially  affecting 
international 
competitiveness  of  energy-intensive  industries  in 
Austria. 

have 

the 

Graph A7.2: Trends in electricity prices for non-
household consumers (EU and foreign partners) 

(61)  It is complemented by Annex 6 as the European Green Deal 

focuses on the clean energy transition and by Annex 8 on the 
action taken to protect the most vulnerable groups, 
complementing ongoing efforts under the European Green 
Deal, REPowerEU and European Green Deal Industrial Plan. 

(62)  In line with the Green Deal Industrial Plan and the Net-Zero 

Industry Act 

(1) For Eurostat data (EU and AT), the band consumption is ID 
referring to large-sized consumers with an annual 
consumption of between 2 000 MWh and 20 000 MWh, such 
as in electricity intensive manufacturing sectors, and gives an 
insight into international competitiveness  
(2) JP = Japan 
Source: Eurostat, IEA 

38 

0.000.050.100.150.200.250.300.35€/KWhGas (industry & service) - ATGas (industry & service) - EUGas (households) - ATGas (households) - EUElectricity (industry & service) - ATElectricity (industry & service) - EUElectricity (households) - ATElectricity (households) - EU050100150200250300Index ( 2018 S2 = 100)JPUKUSATEU 
 
 
     
  
 
 
A  number  of  measures  to  cushion  the 
economic  and  social  impact  of  high  energy 
prices  on  consumers  and  businesses  were 
adopted  already  in  2022 (63),  such  as  the 
electricity cost brake for private households, 
granted until December 2024, and cushioning 
the  increased  grid  loss  charges,  valid  until 
the  end  of  2023.  The  first  measure  subsidises 
around  80%  of  the  average  consumption  of 
Austrian households and compensates households 
for  the  difference  between  the  contract  price  of 
electricity,  with  an  upper  limit  of  EUR 0.25/kWh 
from July 2024 onwards (before EUR 0.4/kWh) and 
a pre-crisis reference price of EUR 0.10/kWh. There 
are special regulations for low-income households 
and households with more than three people. The 
other budgeted relief measure is the cushioning of 
grid  loss  costs  (offsetting  around  80%  of  the 
additional  costs  in  the  grid  loss  fee)  which  is  an 
additional  burden  to  the  consumption-related 
costs.  

Consumer  empowerment  in  the  electricity 
and  gas  markets  in  Austria  is  significant, 
including  the  deployment  of  smart  meters. 
The  share  of  fixed-price  contracts  held  by 
households  decreased  for  electricity  and  gas,  to 
55%  and  to  50%  in  2022,  respectively (64).  This 
was  possibly  caused  by  fewer  offers  on  the 
market, with unusually high prices and no savings 
potential  for  customers  in  Austria.  Likewise,  in 
2022  switching  rates  decreased  in  electricity  (to 
2.5%)  and  gas  (to  about  4%),  with  switching 
procedures  taking  15  days  on  average  for  both 
carriers. In 2022 Austria had equipped 68% of all 
consumers  with  smart  meters,  with  the  goal  of 
reaching  80%  in  2024.  Beginning  of  2024,  more 
than 
are 
1,000 
established. (65) 

communities 

energy 

countries  like  Germany  and  Italy.  Austria  still 
imports  gas  from  Russia  (in  December  2023  the 
Russian  gas  import  share  was  98%),  although 
volumes were reduced  following Russia’s invasion 
of  Ukraine  (from  100  basis  points  in  February 
2022  to  65  in  December  2023) (66).  Dependency 
fluctuated throughout 2023 based on factors such 
as  low  electricity  generation  from  gas  during  fall 
due  to  a  high  share  of  renewable  energy 
generation,  lower  gas  consumption  and  full  gas 
storage  facilities.  Austria  operates  9  underground 
storage  facilities  with  a  total  capacity  of  around 
9.16  bcm,  more  than  covering  all  domestic 
demand  (112%).    Austria  fulfilled  its  gas  storage 
obligations  last  winter,  reaching  99.5%  by  1 
November  2023,  and  ended  the  winter  season 
with  a  storage  filled  at  73.85%  by  1  April  2024. 
Austria  managed  to  considerably  reduce  its  gas 
demand between August 2022 and January 2024 
by 19%. While in the electricity sector the share of 
indigenous  renewable  energy  is  already  higher 
(75 % for 2022) than in the EU average (41 % for 
2022),  energy  supply  as  a  whole  is  still  largely 
based on imported fossil fuels (74.5% in 2022).  

Renewable  installed  capacity  increased  by 
6% in 2022, driven by a significant increase 
in  solar,  in  particular  photovoltaics.  This  is 
below  the  EU  average  increase  of  10%  and 
significantly  below  other  Member  States  with  a 
comparable  high  share  of  hydropower  in  their 
electricity  mix,  such  as  Finland  (+26%).  Total 
renewable  energy  capacity  in  Austria  in  2022 
stood  at  23 GW (67),  dominated  by  64%  of 
hydropower (15 GW). Total wind capacity in Austria 
for  2022  was  3.7 GW,  16%  out  of  the  country’s 
total  renewable  energy  capacity  (an  increase  of 
10% over 2021).   

to 

reduce 

To  ensure  energy  security  of  supply,  Austria 
aims 
import 
dependencies,  in  particular  on  Russian  gas, 
through 
trustful  partnerships,  such  as 
increasing import capacity from neighbouring 

current 

its 

(63)  Strategie Bericht 2024 bis 2027/Budgetbericht 2024 and 
https://www.diepresse.com/18026067/regierung-halbiert-
strompreisbremse 

(64)www.acer.europa.eu/Publications/2023_MMR_Energy_Retail_

Consumer_Protection.pdf  

(65)  www.klimafonds.gv.at/event/energiegemeinschaften-

konferenz-2024/  

(66)  energie.gv.at/  

(67)  IRENA report 2023 

39 

 
 
 
Graph A7.3: Austria's installed renewable capacity 
(left) and electricity generation mix (right) 

(1) "Other" includes solid biofuels, renewable municipal waste, 
liquid biofuels, biogas and geothermal energy 
Source: IRENA, Ember 

regards 

As 
the  acceleration  of  solar 
deployment,  the  total  installed  capacity  in  2022 
was  3.6 GW (68),  15%  of  total  renewable  energy 
capacity  (an  increase  of  27%  over  2021).  Austria 
has  put  in  place  exceptions  regarding  permitting 
for  household--size  PV  installations  as  well  as 
commercial--size  installations  up  to  200  kW  and 
does  not  require  any  permit  for  microgeneration 
up to 0.8 kW. Since January 2024, PV installations 
of up to 35 kWh are exempt from VAT.  

It 

Austria  made  some  steps  in  implementing 
reforms  to  accelerate  the  deployment  of 
renewables. 
legislation  which 
introduced 
streamlines  environmental  impact  assessments 
and  prioritises  energy  transition  projects.  Austria 
plans  to  introduce  a  Renewable  Energy  Expansion 
Acceleration  Act,  with 
to 
accelerate  permit-granting  for  renewable  energy 
projects.  However,  the  visibility  of  the  project 
pipeline for renewable energy projects in Austria is 
only partially clear, as it has not published its long-
term  schedule  for  auctions  for  the  next  5  or  3 
years  and  the  details  of  the  timing,  frequency  of 
auction procedures, expected capacity  and budget 
and  eligible  technologies  are  available  only  for 
2024 and 2025.  

further  measures 

Austria’s relatively high share of renewables 
in  heating  and  cooling  (30.6%  in  2022)  is 
mainly  related  to  biomass  use,  with  heat 
pumps covering a minor share.   

Continued  efforts  for  capacity  expansion  in 
its 
Austria’s  cross-border  as  well  as 

network 

electricity 

domestic 
remain 
necessary to 2030 and beyond. Austria expects 
18GW  of  additional  renewable  energy  capacity to 
be  installed  by  2030 (69),  requiring  its  integration 
into  the  electricity  transmission  and  distribution 
system. There are electricity infrastructure projects 
in Austria which will be important to implement in 
an accelerated manner, included in the new list of 
Projects of Common Interest (PCI) and Projects of 
Mutual  Interest  (PMI).  These  are  the  Kaunertal 
Storage  Extension  Project,  interconnections  and 
Austrian  internal  lines  in  the  Austria-Germany 
cluster,  Interconnector  between  Würmlach  (AT)  - 
Somplago  (IT),  and  the  Interconnector  between 
Lienz (AT) - Veneto region (IT). The implementation 
of  the  priorities  defined  in  the  recently  endorsed 
CESEC  Electricity  and  Renewable  Energy  Action 
Plan  and  the  CESEC  Action  Plan  on  Gases  will  be 
crucial  for accelerated infrastructure development 
and market integration. 

Austria demonstrated significant progress  in 
contributing to reaching the 2030 EU targets 
for  energy  efficiency.  In  2022,  Austria  had  a 
primary  energy  consumption  decrease  of  4.6% 
to  2021,  and  a  4.8%  decrease 
compared 
compared 
It  had  a  final  energy 
to  2012. 
consumption decrease of 5.7% compared to 2021, 
and  a  3.3%  decrease  compared  to  2012.  In  this 
last  year,  the  best  results  came  from  the 
residential sector, which decreased its final energy 
consumption  by  15.4%,  and  the  worst  from  the 
industry  sector  which  increased  its  final  energy 
consumption by 0.2%. 

Austria  has  implemented  a  series  of  energy 
efficiency  measures  with  the  support  of 
several EU funds, including the Recovery and 
Resilience  Facility,  focusing  on  buildings  and 
industry.  Under  cohesion  policy,  25%  of  the 
overall funding allocated to Austria covers energy 
efficiency 
(respectively  22.6%  for 
companies  and  2.47%  for  energy  performance  of 
buildings).  However,  most  of  these  schemes  are 
addressed  to  companies, such  as  new  equipment, 
technology  development  or  support  for  research 
and  demonstration  projects,  to  improve  energy 
efficiency.  

investment 

(68)  IRENA report Renewable Energy Statistics 2023, the data 
might differ from the Eurostat data because a different 
methodology is used to calculate the capacity in AC and DC. 

(69)  APG Network Development Plan 2023, 

https://www.apg.at/en/power-grid/grid-expansion/network-
development-plan-2023/  

40 

 
 
 
 
In  Austria,  most  of  the  schemes  on  energy 
efficiency  are  still  grant-based  and  the  use 
of  financial  instruments  (for  example  debt 
financing  or  tax  rebates  and  exemptions)  is 
still  very  limited.  There  is  a  clear  focus  on 
heating-related  interventions  mostly  targeted  at 
businesses,  but  also  with  households  as 
beneficiaries.  

In relation to buildings, Austria needs to step 
up its efforts in the residential sector if it is 
to  achieve  a  meaningful  contribution  to  the 
2030  building  decarbonisation  milestone  set 
in  its  latest  Long  Term  Renovation  Strategy 
(LTRS). 
energy 
consumption  was  lower  in  2022  than  2020  but 
seen  in  a  longer  perspective  it  has  increased  by 
2.6% (70).  

residential 

Indeed, 

final 

76% of buildings in Austria were built before 
1990,  indicating  that  they  were  built  before 
any  stringent  performance  requirements 
were put in place. Measures in the LTRS include 
regulatory  requirements,  fiscal  and  economic 
incentives, 
information  measures,  as  well  as 
phasing out the use of coal and oil for heating. In 
2022, around 60 000 heat pumps were sold, 57% 
more  than  in  the  previous  year,  reaching  a  total 
stock  of  around  430 000 
the 
residential sector.  

installed 

in 

Austria  is  not  reporting  any  checks  on 
products  covered  by  ecodesign  and  energy 
labelling,  which  raises  serious  concerns  with 
respect to the compliance levels of the products in 
question. 

In its Hydrogen Strategy (71), Austria plans to 
install  1 GW  of  electrolyser  capacity  by 
2030.  Austria  plans  a  very  targeted  use  of 
hydrogen  and  divides  it  into  four  uses: 
feedstock  in  the  chemical  industry  and  the 
steel  industry,  in  aviation  and  shipping  and 
as peak load balance in the energy system. A 
cross-border hydrogen project promoted by Austria 
has  been  selected  on  the  first  PCI/PMI  list:  the 
is 
Italy-Austria-Germany 

hydrogen 

corridor 

(70)  Final energy consumption in households from Eurostat (data-
tables of December 2023), climate-corrected by the Joint 
Research Centre with reference period 2005-2022 (FEC 
climate-corrected = FEC/ (HDD/HDD reference period) 

(71)  Hydrogen Strategy for Austria (2022) 

41 

composed  of 
infrastructure 
internal  hydrogen 
along  the  TAG,  WAG  and  Penta  West  pipelines.  In 
addition,  the  PCI/PMI  list  includes  a  ‘general 
corridor’ aiming to transmit hydrogen from Ukraine 
to Slovakia, Czechia, Austria and Germany.  

Austria  has  a  significant  footprint  in  the 
solar  industry  and  in  the  supply  chain  for 
battery  manufacturing,  with  great  potential 
for  increasing  capacity  further.  There  are  at 
least six manufacturers of PV modules operational 
in  Austria,  with  an  estimated  manufacturing 
capacity  close  to  1  GW  per  year.  Three  of  them 
specialise  in  flexible  photovoltaic  modules  for 
building envelopes, devices and vehicles. Austria is 
also among the leading inverter manufacturers in 
the  EU.  On  wind,  few  Austrian  companies  are 
cooperating  in  the  production  of  key  wind  turbine 
components  such  as 
transformers  or  main 
bearings 
the  global  original  equipment 
for 
manufacturers. Regarding energy storage systems, 
Austria  holds  a  strong  position  in  redox  flow 
batteries,  being  in  the  global  top  three,  together 
with  Japan  and  the  US.  This  sector  has  great 
potential  for  lithium-ion  technologies.  In  Wolfurt, 
there is a lithium-ion battery producer involved in 
pioneering  energy  storage  systems  utilising 
recycled  lithium-ion  EV  batteries.  The  company 
plans to increase its production capacity to reach 1 
GWh  annually.  Regarding  electrolysers,  Austria 
does  not  have  manufacturing  capacity  per  se  but 
was  granted  in  July  2022  EU  funding  under  the 
framework  for  Important  Projects  of  Common 
European Interest for the world's first 1 MW high-
temperature  solid  oxide  electrolyser  based  on 
metal-supported cells (MSCs). 

is  a 

Austria 
innovator  with 
strong 
performance  at  119.9%  of  the  EU  average. 
While  performance  is  above  the  average  it  is 
increasing  at  a  rate  lower  than  that  of  the  EU 
average.  Austria  has  very  attractive  research 
systems with a rating of 153.5% compared to the 
relatively  high 
EU  average.  Austria  spends 
amounts  on  public  R&I  investment  in  energy 
technologies,  e.g.  renewable  energy  technologies, 
smart  solutions  for  consumers, 
integrated  & 
in 
flexible  energy  system,  energy  efficiency 
buildings,  energy  efficiency  in  industry,  renewable 
fuels & bioenergy (each between 5-7% of total EU 
spending). Austria excels specifically in private R&I 
investment in energy technologies, for example in 
renewable fuels & bioenergy with EUR 634 million, 
i.e. 17% of total EU spending in that sector. 

 
 
Table A7.1:  Key Energy Indicators 

(1) The ranking of the main suppliers is based on the latest available figures (for 2022) 
(2) Venture Capital investment includes Venture Capital deals (all stages), Small M&A deals and Private Equity (PE) growth deals 
(for companies that have previously been part of the portfolio of a VC investment firm or have received Angel or Seed funding). 
Source: Eurostat, Gas Infrastructure Europe, JRC elaboration based on PitchBook data (03/2024), JRC SETIS (2024) 

42 

20192020202120222019202020212022Import Dependency [%] 71.6%58.4%51.8%74.5%60.5%57.5%55.5%62.5%of Solid fossil fuels 96.7%97.8%99.4%99.9%43.3%35.8%37.3%45.8%of Oil and petroleum products 95.7%97.5%90.4%94.7%96.7%96.8%91.7%97.7%of Natural Gas 122.8%73.4%51.0%149.1%89.7%83.6%83.6%97.6%Dependency from Russian Fossil Fuels [%]of Natural Gas -                   -                   -                   -                 39.7%41.3%41.1%21.0%of Crude Oil4.2%10.2%8.1%1.9%28.8%26.7%26.4%19.5%of Hard Coal11.3%12.7%13.3%12.0%43.5%49.1%47.4%21.5%2016201720182019202020212022Gas Consumption (in bcm)8.7                   9.4                   8.9                   9.3                 8.8                 9.3                 8.2                 Gas Consumption year-on-year change [%]4.4%7.5%-5.3%4.4%-4.9%5.8%-12.3%Gas Imports - by type (in bcm)7.5                   8.5                   7.8                   11.4               6.5                 4.8                 12.2               Gas imports - pipeline7.5                   8.5                   7.8                   11.4               6.5                 4.8                 12.2               Gas imports - LNG0.00.00.00.00.00.0-                 20192020202120222023LNG Terminals - storage capacity m3 LNGNumber of LNG Terminals00000LNG Storage capacity (m3 LNG)00000Underground StorageNumber of storage facilities9                      9                      9                      9                    9                    Technical Capacity (bcm)8.2                   8.4                   8.5                   8.5                 8.7                 20162017201820192020202120222023Gross Electricity Production (GWh) (2)68,308            71,324            68,618            74,234          72,558          70,757          69,228          -                 Combustible Fuels18,953         21,296         19,900         20,865       18,368       18,678       18,955       -                 Nuclear0000000-                 Hydro43,008         42,175         41,219         44,204       45,344       42,540       39,221       -                 Wind5,235           6,572           6,030           7,450         6,792         6,740         7,245         -                 Solar1,096           1,269           1,455           1,702         2,043         2,783         3,792         -                 Geothermal0                   0                   0                   0                 0                 0                 0                 -                 Other Sources15                 13                 13                 13               12               16               15               -                 Gross Electricity Production [%]Combustible Fuels27.7%29.9%29.0%28.1%25.3%26.4%27.4%-                 Nuclear0.0%0.0%0.0%0.0%0.0%0.0%0.0%-                 Hydro63.0%59.1%60.1%59.5%62.5%60.1%56.7%-                 Wind7.7%9.2%8.8%10.0%9.4%9.5%10.5%-                 Solar1.6%1.8%2.1%2.3%2.8%3.9%5.5%-                 Geothermal0.0%0.0%0.0%0.0%0.0%0.0%0.0%-                 Other Sources0.0%0.0%0.0%0.0%0.0%0.0%0.0%-                 Net Imports of Electricity (GWh)7,159              6,546              8,947              3,129             2,196             7,543             8,705             -                 As a % of electricity available for final consumption 11.1%10.0%13.6%4.7%3.4%11.3%13.2%-                 Electricity Interconnection [%]-                   15.3%42.4%38.1%37.6%31.5%31.3%30.3%Share of renewable energy consumption - by sector [%]Electricity72.5%71.6%74.2%75.1%78.2%74.0%74.7%-                 Heating/cooling33.5%33.7%34.2%33.9%35.0%33.0%30.6%-                 Transport10.6%9.7%9.9%10.1%10.3%9.5%10.1%-                 Overall33.4%33.1%33.8%33.8%36.5%34.6%33.8%-                 20192020202120222023VC investments in climate tech start-ups and scale-ups (EUR Mln)0.52             16.74           23.15           131.07          162.44          as a % of total VC investment (3) in Austria start-ups and scale-ups0.2%5.3%2.1%10.5%23.5%Research & Innovation spending in Energy Union R&i prioritesPublic R&I (EUR mln)-                   -                   224.0           -                 -                 Public R&I (% GDP)-                   -                   -                   -                 -                 Private R&I (EUR mln)-                   1,219.5        -                   -                 -                 Private R&I (% GDP)-                   -                   -                   -                 -                 ELECTRICITY/ENERGYCLEAN ENERGYDIVERSIFICATION OF GAS SUPPLIESAustriaEUENERGY DEPENDNCE 
 
   
 
ANNEX 8: FAIR TRANSITION TO CLIMATE NEUTRALITY 

This  Annex  monitors  Austria’s  progress  in 
ensuring  a  fair  transition  towards  climate 
neutrality  and  environmental  sustainability, 
particularly  for  workers  and  households  in 
vulnerable  situations.  The  green  economy  in 
Austria has gained importance in recent years and 
its proportion of employment in the environmental 
goods  and  services  sector  is  high.  Between  2015 
and 2021, total jobs in the sector grew by 21% (to 
around  206 000)  (EU:  18.2%),  reaching  4.8%  of 
total  employment  and  accounting  for  a  relatively 
high proportion of total employment as compared 
to other Member States (EU: 2.7%). Also, between 
2015  and  2022,  the  greenhouse  gas  emission 
intensity  of  Austria’s  workforce  (see  Graph  A8.1 
and Table A8.1) declined from 13.8 to 12.4 tonnes 
per worker, below the EU average (14.3 tonnes per 
worker  in  2022) (72),  indicating  a  positive  trend  in 
the  green  transition.  However,  skills  shortages  in 
key  sectors  for  the  green  transition  are  rising. 
Regarding  the  implementation  of  the  Council 
Recommendation  of  2022  on  ensuring  a  fair 
transition  towards  climate  neutrality,  challenges 
remain in the upskilling and reskilling of workers in 
declining  and  transforming  sectors  and  the  better 
labour market integration into the green economy 
of women, older workers, low qualified and people 
with  a  migrant  background (73).  Austria’s  recovery 
and  resilience  plan  (RRP)  outlines  crucial  reforms 
and 
investments  for  a  fair  green  transition, 
complementing  the  territorial  just  transition  plans 
and  actions  supported  by  the  European  Regional 
and Development Fund and European Social  Fund 
Plus (ESF+). 

Employment  in  Austria’s  sectors  that  are 
most  affected  by  the  green  transition  is 
stable. In 2023, employment in Austria’s energy-
intensive  industries (74)  comprised  3.2%  of  total 
employment  (EU:  3.5%),  a  slight  decrease  from 
3.3% 
in  mining  and 
quarrying has been stable since 2015 (with around 
8 000 workers in 2023). Labour shortages in key  

in  2015.  Employment 

(72)  Workforce-related calculations are based on the EU Labour 
Force Survey. Note, in the 2023 country report for Austria, 
such indicators were calculated based on employment 
statistics in the national accounts. This may result in limited 
comparability across the two reports. 

(73)  The Council Recommendation of 16 June 2022 on ensuring a 
fair transition towards climate neutrality (2022/C 243/04) 
covers employment, skills, tax-benefit and social protection 
systems, essential services and housing. 

(74)  Mining and quarrying (NACE B), chemicals (C20), minerals 

(C23), metals (C24) and automotive (C29) 

transforming  sectors  are  rising.  The  job  vacancy 
rate  in  construction  (see  Graph  A8.2),  one  of  the 
key sectors for the green transition, is higher than 
the  EU  average  (6.4%  vs  3.6%  in  2023),  in  line 
with  the  perception  of  small  and  medium-sized 
enterprises  (SMEs)  in  the  sector,  where  74% 
reported  that  skills  shortages  are  holding  them 
back in general business activities (75). According to 
the  European  Labour  Authority  (ELA) (76),  labour 
shortages were reported in 2023 for a number of 
occupations 
required  specific  skills  or 
knowledge  for  the  green  transition (77),  including 
electrical  engineering  technicians,  roofers  and 
plumbers  and  pipe  fitters.  At  least  25%  of  ESF+ 
subsidies  for  self-employment  of  young  people 
under  30  are  expected  to  be  earmarked  for 
entrepreneurial projects in the green economy.   

that 

Graph A8.1: Fair transition challenges in Austria 

Source: Eurostat, EU Labour Force Survey, EMPL-JRC GD-
AMEDI/AMEDI+ and DISCO(H) projects (see Table A8.1). 

Upskilling  and  reskilling  in  energy-intensive 
increased,  but  skills 
industries  slightly 
shortages persist. In energy-intensive industries, 
workers’  participation  in  education  and  training 
increased from 15.7% in 2015 to 15.6% in 2023, 
well  above  the  EU  average  (10.9%).  45%  of 
Austrian SMEs reported that the skills required for 
greening  business  activities  are  becoming  more 
important  (EU:  42%) (75).  If  Austria  matches  its 
projected contribution to the EU’s 2030 renewable 
target,  between  3  500  and  4 400 
energy 

(75)  Eurobarometer on skills shortages, recruitment, and retention 

strategies in small and medium-sized enterprises. 

(76)  Based on the European Labour Authority 2024 EURES Report 
on labour shortages and surpluses 2023, i.e., data submitted 
by the EURES National Coordination Offices. 

(77)  Skills and knowledge requirements are based on the 

European Skills Competences and Occupations (ESCO) 
taxonomy on skills for the green transition. 

43 

0.00.51.01.5Greenhouse gasemissions per workerEmployment inEnergy-IntensiveIndustriesEducation & trainingin Energy-IntensiveIndsutriesEnergy povertyTransport poverty(proxy)Carbon inequalityAT Latest vs EU LatestEU LatestAT 2015 vs EU Latest 
 
 
  
 
 
Table A8.1:  Key indicators for a fair transition in Austria 

Source: Eurostat (env_ac_ainah_r2, lfsa_egan2d, ilc_mdes01), EU Labour Force Survey (break in time series in 2021), EMPL-JRC 
GD-AMEDI/AMEDI+ and DISCO(H) projects. 

additional  skilled  workers  will  be  needed  for  the 
deployment  of  wind  and  solar  energy,  which  may 
require  an  investment  in  skills  of  EUR  45.5-56.8 
million (78). To  address  this  challenge,  specific 
investments under the RRP and the Just Transition 
Mechanism  provide  training  for  reskilling  workers 
in regions affected by the transition, together with 
a  broader  training  offer  at  national  level  and 
flexibility  mechanisms  to  encourage  in-company 
training.  In  Austria,  approximately  6%  of  ESF+ 
funding  is  helping  increase  green  skills  and  jobs. 
For instance, the ‘CORA’ project provides computer 
training  for  women  to  improve  the  skills  needed 
for green related jobs and to meet the demands of 
the labour market. 

Graph A8.2: Job vacancy rate in transforming 
sectors and mining and quarrying 

B - Mining and quarrying 
C - Manufacturing 
D - Electricity, gas, steam and air conditioning supply 
E - Water supply; sewerage, waste management and 
remediation activities 
F - Construction 
H - Transportation and storage 
Source: Eurostat jvs_a_rate_r2 

Energy  poverty  indicators  have  worsened 
slightly  in  Austria  following  the  spike  in 
energy  prices  but  remain  well  below  the  EU 
average.  The  share  of  the  population  unable  to 
keep  their  homes  adequately  warm  decreased 
from  2.6%  in  2015  to  1.7%  in  2021.  However,  it 

(78)  EMPL-JRC AMEDI project. 

44 

rose again to 2.7% in 2022 on the back of energy 
price  increases  due  to  supply  constraints  caused 
by  the  COVID-19  pandemic  and  Russia’s  war  of 
aggression against Ukraine, despite the emergency 
measures  implemented  in  Austria.  Nonetheless,  it 
remained well below the EU average (9.3%) (79). In 
particular,  4.8%  of  the  population  at  risk  of 
poverty  (AROP)  (EU:  20.1%)  and  1.2%  of  lower 
middle-income  households 
(EU:  11.6%)  were 
unable to keep their homes warm in 2022. On the 
other  hand,  in  January  2023,  40.8%  of  the 
population at risk of poverty  spent a considerable 
proportion  of  their  budget  (more  than  6%)  on 
private transport fuels (EU: 37.1%) (80). 

Despite  being  below 
the  EU  average, 
environmental inequalities remain an issue in 
Austria. In 2022, the consumption footprint of the 
20%  of  the  population  with  the  highest  income 
was  1.4  times  higher  than  the  footprint  of  the 
poorest  20%  (EU:  1.8) (81).  For  both  groups,  the 
consumption  footprint  is  highest  for  food  and 
housing. In addition, while the average levels of air 
pollution in 2021 stood below the EU average (9.9 
vs 11.4 µg/m3 PM2.5), 53% of the population still 
live  in  regions  exposed  to  critical  levels  of  air 
pollution (82).  This  has  led  to  a  significant  impact 
in 
on  health,  affecting  vulnerable  groups 

(79)  Energy poverty is a multi-dimensional concept. The indicator 
used focuses on an outcome of energy poverty. Further 
indicators are available at the Energy Poverty Advisory Hub. 

(80)  Affordability of private transport fuels is one key dimension 

of transport poverty. The indicator has been developed in the 
context of the EMPL-JRC GD-AMEDI/AMEDI+ projects. 
Methodology explained in Economic and distributional effects 
of higher energy prices on households in the EU. 

(81)  Developed in the context of the EMPL-JRC DISCO(H) project. 
Methodology explained in Joint Research Centre, 2024. 
Carbon and environmental footprint inequality of household 
consumption in the EU. JRC137520. The EU average refers to 
EU27 without Italy (household income data not available for 
IT in the HBS) 

(82)  Two times higher than the recommendations in the WHO Air 

Quality Guidelines (annual exposure of 5µg/m3). 

0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%BCDEFHEU 2023AT 2023AT 2015IndicatorDescriptionAT 2015ATEUGHG per workerGreenhouse gas emissions per worker – CO2 equivalent tonnes13.812.4 (2022)14.3 (2022)Employment EIIEmployment share in energy-intensive industries, including mining and quarrying (NACE B), chemicals (C20), minerals (C23), metals (C24) and automotive (C29)3.3%3.2% (2023)3.5% (2023)Education & training EIIAdult participation in education and training (last 4 weeks) in energy-intensive industries15.4%15.6% (2023)10.9% (2023)Energy povertyShare of the total population living in a household unable to keep its home adequately warm2.6%2.7% (2022)9.3% (2022)Transport poverty (proxy)Estimated share of the AROP population that spends over 6% of expenditure on fuels for personal transport30.5%40.8% (2023)37.1% (2023)Carbon inequalityRatio between the consumption footprint of the top 20% vs bottom 20% of the income distribution1.41.4 (2021)2.7 (2021) 
 
   
 
 
 
  
 
particular,  and  around  3 200  premature  deaths 
annually (83).  

Austria  is  progressing  well  in  implementing 
policies for a fair transition towards climate 
neutrality. It is implementing measures that aim 
to  provide  people  with  relevant  knowledge  to 
support  their  employment  in  the  green  economy 
and  to  ensure  quality  employment  for  a  fair  and 
green transition. However, green jobs in Austria are 
dominated  by  men  and  a  gender  pay-gap  still 
exists.  Further  efforts  are  required  to  improve 
women’s  participation  in  the  context  of  the  fair 
transition,  e.g.  in  providing  quality  and  accessible 
care  services  for  children  and  older  people  who 
need  long-term  care.  Austria  could  benefit  from 
further  analysis  to  assess  the  creation  of  green 
jobs  thanks  to  those  measures  that  target 
upskilling and reskilling for smooth labour market 
transitions (84). 

(83)  EEA- Air Quality Health Risk Assessment 

(84)  Based on the monitoring review of the Council 

Recommendation on ensuring a fair transition towards 
climate neutrality, which took place in October 2023. 

45 

 
 
PRODUCTIVITY 
ANNEX 9: RESOURCE PRODUCTIVITY, EFFICIENCY AND CIRCULARITY 

The green transition of industry and the built 
environment,  in  particular  decarbonisation, 
resource  efficiency  and 
is 
Austria’s 
essential 
competitiveness (85).  In  this  regard,  the  priority 
for  Austria  is  the  use  of  circular  materials  and 
business models in industry and construction. 

circularity, 

boost 

to 

Austria  would  benefit  from  boosting  its 
circular economy transition to achieve the EU 
Circular Economy Action Plan goals due to its 
high  impact  economy.  The  material  footprint  in 
2022  showed  an  increasing  trend  and  remained 
significantly  above  the  EU  average,  23.5  versus 
14.8 tonnes per capita. The total waste generation 
increased  between  2010  and  2022,  when  Austria 
produced  7.7  tonnes  of  waste  per  capita,  above 
the  EU  average. In  2022,  Austria  adopted  a 
to 
comprehensive  circular  economy  strategy 
address  these  challenges  and  reduce  its  material 
footprint and circular material use rate, including a 
25%  reduction  of  the  domestic  material  footprint 
its  circular 
by  2030.  Full  implementation  of 
economy strategy will be key to reap the benefits 
and achieve the ambitious objectives set. 

Since  2013,  greenhouse  gas  emissions 
covered  by  the  EU  emissions  trading  system 
(ETS) in Austria (86) have declined by 18% (87). 
In  2023,  only 13%  of  greenhouse  gases  emitted 
by  Austria’s  ETS  installations  came  from  power 
generation,  significantly  below  the  EU  average 
(57%).  Of  the  total  emissions  from  all  industry 
sectors,  the  metals  industry  emitted  over  half 
(56%),  cement  and  lime  production  16%,  other 
industries 11%, refineries 12% and chemicals 4%. 
Between  2019  and  2023,  the  power  sector 
registered  a  higher  emissions  reduction  (44%) 
than  the  industry  sectors  (11%),  leading  to  an 
overall reduction of 17%. Since 2013, greenhouse 
gas  emissions  have  declined  by  49%  in  power 
generation, but they have decreased by only 10% 
in the other ETS sectors, due to adverse trends in 

(85)  See also Annexes 6, 7 and 12. 

(86)  This analysis excludes air travel. For more details and the 
data sources, see Weitzel, M; van der Vorst, C. (2024), 
Uneven progress in reducing emissions in the EU ETS, JRC 
Science for policy brief, JRC138215, Joint Research Centre. 

(87)  In 2013-2022, greenhouse gas emissions from Austria’s ETS 
installations oscillated between 27 and 30.5 million tonnes 
of CO2 equivalent. 

chemicals  and  cement  production  and  stubbornly 
high emissions in the metals sector.  

Graph A9.1: ETS emissions by sector since 2013 

Source: European Commission 

industry 

is  progressing 

The  Austrian 
in 
making  more  efficient  use  of  resources,  but 
it  remains  more  exposed  to  supply  chain 
disruptions  than  other  Member  States.  The 
circular material use rate increased between 2017 
and  2022,  reaching  13.8%,  surpassing  the  EU 
average.  Material  import  dependence  decreased 
between 2017 and 2022 – from 43.1% to 40.1% 
of materials used – but was still almost twice the 
EU  average  of  22.4%.  By  contrast,  resource 
productivity  increased,  reaching  2.50 purchasing 
power  standards  per  kilogram  (PPS/kg)  in  2022, 
versus 2.11 PPS/kg in 2017. Water abstraction for 
manufacturing  purposes  accounted  for  49.8%  of 
in  2018,  making 
total  water  abstracted 
manufacturing  the  first  sector  in  Austria  in  terms 
of water intake. Austria is among the EU’s leaders 
in  sustainable  innovation.  On  the  2022  Eco-
Innovation  Scoreboard,  Austria  ranked  3rd  among 
EU Member States. Furthermore, as of September 
2023,  the  country  totalled  264  awarded  EU 
Ecolabel  licences  and  982  products  with  the  EU 
Ecolabel,  higher  than  in  previous  years.  Austria 
ranked 4th in terms of EU Ecolabel licences. 

Austria  is  among  the  EU’s  top  performers in 
waste  management,  but  municipal  waste 
keeps growing. With a municipal waste recycling 
rate  of  62.5%  in  2021,  Austria  achieved  the  EU 
target of 50% recycling by 2020 and is on track to 
meet the 2025 target for recycling and the 2035 
target  for  landfilling.  However,  the  recycling  rate 
of  plastic  packaging  is  below  the  EU  average  – 
30.7%  versus  39.7%  –  putting  Austria  at  risk  of 
missing 
target. 
the  2025  material-specific 
However, the Austrian recovery and resilience plan 
envisages  investments  in  constructing  new  and 

46 

00.20.40.60.8105101520253020132014201520162017201820192020202120222023Emissions relative to 2013Mt CO2eCement & LimeChemicalsMetalsRefineriesPower generationOtherAustria (both axes) 
 
 
 
  
 
retrofitting  existing  plastic  waste  sorting  facilities 
to increase the amount of recycled material.   

Austria’s hazardous waste treatment. In 2020, the 
country  produced  144 kg  of  hazardous  waste  per 
capita and only 31.3% of it was treated. 

Graph A9.2: Treatment of municipal waste 

recent 

improvements. 

The  built  environment  system  continues  to 
exacerbate  the  depletion  of  resources, 
despite 
Austria’s 
residential  floor  area  increased  from  62.4  m2  in 
2018 to 63.5 m2 in 2020, above the EU average of 
54.4 m2  per  capita.  The  non-residential  floor  area 
in 2020 was also above the EU average. Between 
2006 and 2012, Austria had a relatively low share 
of  land  recycling  and  densification,  7%  versus  an 
EU average of 13.5%. It is at risk of not achieving 
the  8th  Environment  Action  Programme  objective 
of managing land sustainably and reaching no net 
land  take  by  2050.  To  tackle  this  issue,  Austria 
agreed  to  develop  a  national  soil  protection 
strategy  with  the  headline  target  of  limiting  net 
land  use  to  2.5 ha  by  2030.  Adoption  of  this 
reform by 2022 was included in the recovery and 
resilience plan but is still pending. 

for 

targets 

Austria  is  on  track  to  meet  the  Waste 
the 
Framework  Directive’s 
construction  sector,  but  waste  generation 
per  capita  is  among  the  highest  in  the  EU. 
Waste generated from construction and demolition 
activities almost since 2010, reaching 11.5 million 
tonnes.  The  proportion  of  backfilling  slightly 
increased  from  48%  in  2018  to  50%  in  2020. 
Austria’s  recovery  rate  has  decreased  and  stands 
at  84%  in  2021.  Successful  pilot  projects  have 
been  developed,  such  as  Baukarussell,  which 
promotes reuse in buildings at large scale. 

Source: Eurostat 

lower 

is  still  room  to 

industry’s 
There 
pollution.  Austria’s  industry  impacts  air  quality 
less  than  in  other  Member  States.  In  2020,  the 
grams  of  PM2.5  and  PM10  emitted  per  economic 
output  (EUR’10) (88)  were  equal  to  0.02  and  0.04, 
respectively,  versus  an  EU  average  of  0.07  and 
0.1.  In  2010-2021,  Austria’s  industrial  sector 
decreased  its  emissions  of  main  pollutants  into 
the  air  and  water,  and the  country  ranked  among 
the  top  5  countries  for  reduction  of  air  emissions 
of CO2 and heavy metals (cadmium, mercury, and 
lead). However, an opposite trend was reported for 
nitrogen  pollution  into  water,  which  has  modestly 
increased  over  time.  There  is  room  to  improve 

Table A9.1:  Circularity indicators 

Source: Eurostat, European Environment Agency 

(88)  In 2010 prices. 

47 

5795888348350010020030040050060070080090020182019202020212022Kg per capita Waste treatment to be determinedLandfill/disposalTotal incineration (including energy recovery)Composting and digestionMaterial recyclingEU-27201820192020202120222023EU-27Latest yearIndustryResource productivity (purchasing power standard (PPS) per kilogram)2.22.22.12.22.5-2.52022Circular material use rate (%)11.911.611.512.813.8-11.52022Eco-innovation index (2013=100)153.1156.5159.6157.2173.9-121.52022Recycling of plastic packaging (%)31.930.831.630.7--40.72021Cost of air emissions from industry (EUR bn)6.74.94.04.3--352.72021Built environmentRecovery rate from construction and demolition waste (%)90.0-91.084.4--89.02020Soil sealing index (base year = 2006)102.9-----103.42018Non-residential floor area (m2 per capita)21.521.621.8---18.02020Waste backfilled (%)4.6-5.1-3.7-9.92020 
          
 
 
 
 
 
 
       
 
ANNEX 10: DIGITAL TRANSFORMATION 

its 

for 

targets 

Digital  transformation  is  key  to  ensuring  a 
resilient and competitive economy. In line with 
the  Digital  Decade  policy  programme,  and  in 
particular  with 
digital 
transformation  by  2030,  this  Annex  describes 
Austria’s  performance  on  digital  skills,  digital 
infrastructure/connectivity and the digitalisation of 
businesses  and  public  services.  Where  relevant,  it 
makes reference to progress on implementing the 
recovery  and 
(RRP).  Austria 
resilience  plan 
allocates 36% of its total Recovery and Resilience 
Facility  budget  to  digital  (EUR 1.34 billion) (89). 
Under cohesion policy, an additional EUR 80 million 
(7% of the country’s total cohesion policy funding) 
is 
digital 
the 
allocated 
transformation (90). 

country’s 

to 

The  Digital  Decade  policy  programme  sets 
out a pathway for the EU’s successful digital 
transformation  by  2030.  Austria’s  national 
roadmap outlines the actions it intends to take to 
reach the objectives and targets at national  level. 
The first report on the state of the Digital Decade 
highlighted the need to accelerate and deepen the 
collective efforts to reach the EU-wide targets and 
objectives (91).  Through  this,  a  digitally  skilled 
population 
the  development  and 
adoption  of  digital  technologies  and  leads  to 
productivity  gains  and  new  business  models.  It 
also  leads  to  higher  inclusion  and  participation  in 
an environment increasingly shaped by the digital 
transformation (92). 
technologies, 
infrastructure  and  tools  all  play  a  role 
in 
addressing 
the  current  structural  challenges, 
including  strategic  dependence  in  various  areas, 
cybersecurity and climate change. 

increases 

Digital 

(89)  The share of financial allocations that contribute to digital 
objectives has been calculated using Annex VII to the 
Recovery and Resilience Facility Regulation. 

(90)  This amount includes all investment specifically aimed at or 
substantially contributing to digital transformation in the 
2021-2027 cohesion policy programming period. The source 
funds are the European Regional Development Fund, the 
Cohesion Fund, the European Social Fund Plus, and the Just 
Transition Fund. 

(91)  European Commission (2023): Report on the state of the 

Digital Decade 2023, 2023 Report on the state of the Digital 
Decade | Shaping Europe’s digital future (europa.eu). 

(92)  See for example OECD (2019): OECD Economic Outlook, 

Digitalisation and productivity: A story of complementarities, 
OECD Economic Outlook, Volume 2019 Issue 1 | OECD 
iLibrary (oecd-ilibrary.org) and OECD (2019): Going Digital: 
Shaping Policies, Improving Lives – Summary, 
https://www.oecd.org/digital/going-digital-synthesis-
summary.pdf. 

48 

The  lack  of  information  and  communication 
is  a  key 
(ICT)  specialists 
technology 
challenge  for  Austria  in  the  area  of  digital 
skills.  The  percentage  of  the  population  with  at 
least  basic  digital  skills  is  well  above  the  EU 
average.  While  the  share  of  ICT  specialists  in 
employment  (5.3%)  is  above  the  EU  average 
(4.8%),  the  lack  of  digital  experts  is  a  key 
challenge: the share of enterprises reporting hard-
to-fill  vacancies  for  jobs  requiring  ICT  specialist 
skills was well above the EU average in 2023 (93).  

infrastructure,  Austria’s  very  high 
On 
capacity  network  (VHCN)  coverage  is  below 
the  EU  average  but  good  for  5G.  VHCN 
coverage  stood  at  68% 
in  good 
progression  from  2022  but  still  below  the  EU 
average  (79%).  On  the  contrary,  5G  is  well 
developed with 96% of populated areas covered. 

in  2023, 

Austria’s  performance  on  the  digitalisation 
of businesses is mixed. The percentage of SMEs 
with  at  least  a  basic  level  of  digital  intensity  is 
equal to the EU average. One key challenge is that 
Austrian companies are not yet making full use of 
all available digital technologies. For example, the 
use  of  artificial 
intelligence  among  Austrian 
companies  is  slightly  above  the  EU  average,  but 
the  use  of  cloud  services  and  data  analytics  is 
below  the  EU  average.  This  is  consistent  with  the 
new indicator ‘AI or cloud or data analytics’, which 
combines  the  three  indicators  on  the  use  of 
technologies  into  a  single  number,  and  shows  a 
value  that  is  8 percentage  points  below  the  EU 
average.  Several  RRP  measures  to  improve  the 
in  Austrian 
take-up  of  digital 
enterprises  have  been  launched,  e.g.  to  provide 
advisory  services  and  investment  for  concrete 
digitalisation  projects. 
In  2022,  3.4%  of 
enterprises  in  Austria  reported  ICT  service  outage 
due  to  cyberattacks  (e.g.  ransomware  attacks, 
denial  of  service  attacks).  Over  the  same  year, 
18.6%  of  enterprises  developed  or  reviewed  their 
ICT security policy within the previous 12 months. 

technologies 

Austria  performs  around  the  EU  average  on 
the  digitalisation  of  public  services  for 
citizens  and  businesses.  The  country  has 
traditionally  been  a  frontrunner  in  e-government 
relatively  high  number  of 
services,  with  a 

(93)  Source: Eurostat – European Union Survey on ICT Usage and 

e-Commerce in Enterprises. 

 
 
 
 
 
 
e-government  users.  On  the  supply  side,  Austria 
scores  slightly  above  the  EU  average  in  providing 
digital public services to citizens and slightly below 
in  providing  digital  public  services  to  businesses. 
Austria’s  Business  Service  Portal  Act  has 
introduced  the  ‘once  only’  principle.  The  country 
has  also  published  its  Digitalisation  Fund  Act, 
which  aims  to  accelerate  the  digitalisation  of  the 
Austrian  federal  administration.  The  ‘ID  Austria’ 
electronic  identification  scheme  has  been  fully 
operational since April 2023. Every Austrian citizen 
receives  a  digital  ID  automatically  with  their 

digital 

solutions 

application for a passport. ‘ID  Austria’ will provide 
registration 
(e.g. 
further 
certificate)  including  private  sector  offers  and  is 
rolling out the digital driving licence. As a notified 
scheme  under  the  eIDAS  (electronic  identification, 
authentication  and  trust  services)  Regulation,  ‘ID 
Austria’ also provides the underlying basis for the 
good  performance  on  access  to  electronic  health 
records.  Austria’s  score  is  88,  compared  to  an  EU 
average score of 79. 

Table A10.1:Key Digital Decade targets monitored by the Digital Economy and Society Index indicators 

(1) The 20 million target represents about 10% of total employment. 
(2) The fibre to the premises coverage indicator is included separately as its evolution will also be monitored separately and taken 
into consideration when interpreting VHCN coverage data in the Digital Decade. 
(3) At least 75% of EU enterprises have taken up one or more of the following, in line with their business operations: (i) cloud 
computing services; (ii) big data; (iii) artificial intelligence.   

Source: Digital Economy and Society Index 

49 

EUDigital Decade target by 2030 2022202320242024(EU)Digital skillsAt least basic digital skills63%63%65%56%80%% individuals20212021202320232030ICT specialists (1)4.5%5.0%5.3%4.8%20 million% individuals in employment aged 15-7420212022202320232030Digital infrastructure/connectivityFixed very high capacity network (VHCN) coverage45%55%68%79%100%% households20212022202320232030Fibre to the premises (FTTP) coverage (2)27%37%41%64%-% households2021202220232023Overall 5G coverage77%92%96%89%100%% populated areas20212022202320232030Digitalisation of businessesSMEs with at least a basic level of digital intensity64%NA58%58%90%% SMEs2021202320232030Data analyticsNANA24%33%-% enterprises20232023Cloud29%29%36%39%-% enterprises2021202120232023Artificial intelligence9%9%11%8%-% enterprises2021202120232023AI or cloud or data analytics (3)NANA47%55%75%% enterprises202320232030Digitalisation of public servicesDigital public services for citizens76788179100Score (0 to 100)20212022202320232030Digital public services for businesses81838385100Score (0 to 100)20212022202320232030Access to e-health recordsNA888879100Score (0 to 100)2022202320232030Austria 
 
      
 
 
ANNEX 11: INNOVATION 

This  Annex  provides  a  general  overview  of 
the  performance  of  Austria’s  research  and 
innovation  system,  which 
is  essential  for 
delivering  the  twin  transition  and  ensuring  long-
term competitiveness. 

Austria  is  a  ‘strong  innovator’,  with  its 
performance  increasing  albeit  at  a  lower 
rate  than  the  EU’s.  According  to  the  2023 
edition of the European Innovation Scoreboard (94), 
the  country’s  performance  stands  at  119.5%  of 
the  EU  average  and  is  above  the  average  of  the 
its 
strong 
performance lead over the EU is shrinking. 

(111.6%).  However, 

innovators 

Austria’s  R&D  intensity (95)  has  continuously 
increased  over  the  last  decade  and  ranked 
third  in  the  EU  in  2022  (at  3.20%).  This 
favourable  trend  is  evident  in  both  public  R&I 
intensity (0.98%  in  2022 against  0.85% in  2010) 
and business R&I intensity (2.2% in 2022 against 
1.87%  in  2010).  R&D  tax  credits  have  increased 
steadily  in  Austria  over  time  and  are  seen  as  a 
strong  incentive  for  R&D  activities  by  Austrian 
companies (96). 

into 

The high level of R&D investments does not, 
innovation 
however,  fully  translate 
outcomes  when  compared  to  peer  countries, 
especially  when 
it  comes  to  business 
creation,  early-stage  innovation  and  growth 
in the high-tech sector. Austria produces fewer 
innovation  outputs 
level  of 
relative 
innovation investments (97). This has an impact on 
business dynamism: only 7.02% of Austrians were 
employed  in  fast-growing  enterprises  in  2020, 
against  an  EU  average  of  12.51%.  Only  4%  of 
Austrian SMEs qualified as high growth, below the 

its 

to 

(94)  2023 European Innovation Scoreboard (EIS), country profile: 

Austria https://research-and-
innovation.ec.europa.eu/statistics/performance-
indicators/european-innovation-scoreboard_en: The EIS 
provides a comparative analysis of innovation performance 
in EU countries, including the relative strengths and 
weaknesses of their national innovation systems (also 
compared to the EU average). 

(95)  Defined as gross domestic expenditure on R&D as a 

percentage of GDP. 

10% EU average (98). With its research, technology 
and  innovation  (RTI)  strategy  for  2030  Austria 
aims to become an international innovation leader 
and  has  set  itself  the  goal  of  generating  ‘100% 
more economically successful academic spin-offs’. 
Since then, the valorisation of research results for 
the  benefit  of  the  economy  and  society,  in 
particular  through  business  start-ups  by  students 
and  researchers,  has  increasingly  been  the  focus 
of science, business and research policy (99). 

Graph A11.1: Employment share of high growth 
enterprises measured in employment (%) 

Source: Eurostat 

to 

leading 

standards, 

The  relatively  small  size  of  markets for  risk 
capital,  which  includes  venture,  growth  and 
equity capital, is a key reason behind the low 
level of business dynamism.  For years the risk 
capital  intensity  of  Austria  has  remained  below 
international 
limited 
scalability  for  certain  Austrian  start-ups.  These 
start-ups either do not expand or struggle to do so 
within Austria, often relying on foreign risk capital. 
Consequently, this situation may contribute to the 
migration  of  start-ups (100).  Venture 
capital 
intensity as % of GDP has increased compared to 
previous  years (0.023 in 2020,  0.08  in  2022)  but 
is  still  below  the  EU  average  (0.085) (101).  In  the 
economic  survey  of  the  Austrian  economy  from 
2021,  the  OECD  called  for  improvements  in  the 
effectiveness  of  start-up  and  growth  financing 
including  by  avoiding  complexity, 
instruments, 

(98)  ) https://ec.europa.eu/docsroom/documents/54957  

(99)  Innovation (bmaw.gv.at). 

(96)  rd-tax-stats-austria.pdf (oecd.org). 

(100) https://www.rat-fte.at/archive/files/rat-fte-pdf/RFTE-

(97)  https://www.wipo.int/edocs/pubdocs/en/wipo-pub-2000-

2023-en-main-report-global-innovation-index-2023-16th-
edition.pdf  

TB2023.pdf  

(101) Data used from Invest Europe (May 2023) using a 3-year 

moving average to reduce volatility.  

50 

02468101214201220152020[%]AustriaEU average 2020 
 
 
  
 
 
Table A11.1:Key innovation indicators 

(1) EU average for the last available year or the year with the largest number of country data. 
Source: Eurostat, OECD, DG JRC, Science-Metrix (Scopus database and EPO’s Patent Statistical Database), Invest EU 

scaling  up  later-stage  funding  and  improving 
conditions  for  institutional  investors  to  invest  in 
venture  capital (102).  The  aim  of 
the  newly 
introduced  initiative  ‘Startup  Invest’  is  to  increase 
the  risk  capital  for  Austrian  technology  start-ups 
with high scaling potential using the experience of 
successful investors (103). 

(102) https://www.oecd-ilibrary.org/docserver/eaf9ec79-

en.pdf?expires=1701362724&id=id&accname=oid031827&
checksum=0A5F416A4D61661199C194BC5A66FC29  

(103) https://www.aws.at/aws-start-up-invest-boosting-scaling-

potentials/  

51 

EUaverage (1)R&D intensity (GERD as % of GDP)2.733.053.23.263.22.24Public expenditure on R&D as % of GDP0.850.860.9610.980.73Business enterprise expenditure on R&D (BERD) as % of GDP1.872.182.232.252.21.48Scientific publications of the country within the top 10% most cited publications worldwide as % of total publications of the country 111110.24::9.6Patent Cooperation Treaty patent applications per billion GDP (in PPS)5.354.77::3.4Public-private scientific co-publications as % of total publications12.613.614.915.615.67.6Public expenditure on R&D financed by business enterprise (national) as % of GDP:0.046:0.063:0.054New graduates in science & engineering per thousand pop. aged 25-3415.518.319.419.2:16.9Total public sector support for BERD as % of GDP:0.288:0.34:0.204R&D tax incentives: foregone revenues as % of GDP0.1110.1460.2740.22:0.104Share of environment-related patents in total patent applications filed under Patent Cooperation Treaty (%)17.413.817.9: :14.7Venture capital (market statistics) as % of GDP0.020.0230.0230.0750.080.085Employment share of high growth enterprises measured in employment (%):7.457.02::12.51Finance for innovation and economic renewalKey indicators Quality of the R&I systemAcademia-business cooperationHuman capital and skills availabilityPublic support for business enterprise expenditure on R&D (BERD)Green innovation 2022Austria2010201520202021 
 
 
   
 
ANNEX 12: INDUSTRY AND SINGLE MARKET 

the 

The 

report 

shows 

According 

infrastructure 

Austrian  competitiveness  shows  a  declining 
IMD  World 
to 
trend. 
Competitiveness  Centre,  Austria  ranked  24th  in 
2023, down 4 places since last year and 8 places 
since  2020 (104). 
that 
government  efficiency  (especially  tax  policy  and 
reform  of  the  pension  and  healthcare  system)  is 
the  biggest  challenge,  while 
is 
perceived  as  the  main  strength  in  Austria.  The 
Competitiveness  Radar  developed  by  the  Austrian 
Institute of Economic Research (WIFO) also shows 
the  same  trend,  with  the  country  lagging  behind 
the  top  third  of  comparable  EU  countries  due 
mainly  to  low  indicators  for  employment  and 
income  distribution (105).  Moreover,  nominal  unit 
labour costs, which are rising due to high inflation, 
and  continued  energy  imports  dependency  affect 
Austria’s cost competitiveness position. While R&D 
expenditure  is  high,  well  above  the  EU  average, 
unfavourable  demographic  developments  lead  to 
declining  labour  force,  and  economic  growth  will 
be  constrained.  Productivity  growth, investment in 
infrastructure,  technology  and  human  capital  will 
therefore  be  key  to  boosting  Austria’s  economic 
performance. 

Graph A12.1: Real labour productivity per hour 
worked at industry level (Index, 2015=100) 

Source: Eurostat 

Productivity  grew  slowly  in  recent  years  but 
remains  above  the  EU  average.  Labour 
productivity  (in  terms  of  GDP  per  hour  worked) 
reached  119%  of  the  EU  aggregate  in  2023  (in 
purchasing  power  standards).  In  annual  terms, 
labour  productivity  decreased  by  1.7%  in  2023 
and  the  average  growth  in  the  last  decade  was 
only  0.6%,  in  line  with  other  EU  peer  countries. 
in 
However, 

large  differences 

there  are 

trend, 

services 

financial 

productivity  by  sector  (see  Graph  A12.1).  While 
construction,  retail  and  accommodation  services 
(badly  hit  during  the  pandemic) (106)  show  a 
declining 
and 
manufacturing  have  productivity  growth  rates 
above  the  EU  average.  Labour  productivity  in 
industry  decreased  by  3.6%  per  person  and  by 
3.3%  per  hour  in  2023,  clearly  below  the  EU 
averages. There were similar trends in total factor 
productivity,  which  has  been  stagnating  since 
2015  with  average  growth  of  0.3%,  in  line  with 
other  advanced  EU  economies.  According  to  the 
Austrian  Productivity  Board,  the  weak  growth  in 
labour  and  total  factor  productivity  is  due  to  a 
slowdown  in  productivity  growth  within  sectors 
and firms and not to the shift in the share of value 
added between sectors or companies (107).  

High levels of  investment  and  corresponding 
high  capital  intensity  are  important  factors 
in  Austria’s  growth.  In  2022,  the  investment 
ratio  was  among  the  highest  in  the  EU,  reaching 
25.3%  of  GDP  (business  investment  was  15.7%, 
two  percentual  points  above  the  EU  average). 
However, aggregate investment is stagnating, with 
significant drops in the construction sector (largely 
driven by residential buildings), mainly due to high 
uncertainty  and 
costs. 
increasing 
According to the EIB Investment Survey,  the main 
barriers to investment are the availability of skilled 
staff  (91%  of  respondents  against  the  81%  EU 
average),  energy  costs  (83%)  and  uncertainty 
about the future (78%) (108). 

financing 

The  Austrian  economy  is  highly  integrated 
into  global  supply  chains,  particularly  with 
Germany  and  Eastern  European 
countries. 
Between  2008  and  2020,  the  foreign  content  of 
Austria’s  exports  is  estimated  to  have  increased 
from 27.4% to 30.1%, above the OECD average of 
27.6%.  By  industry,  basic  metals  and  motor 
vehicles are the most integrated.  

(106) It is important to highlight the evolution of tourism, with a 

GDP contribution that fell to 2.7% in 2021, down from 5.3% 
in 2019 due to the pandemic. However, the sector seems to 
have come out of the crisis in 2023, with overnight stays and 
a winter season that already reached pre-crisis levels of 
2019 (Statistics Austria, 2024). 

(104) IMD World Competitiveness Ranking 2023. 

(107) Austrian Productivity Board. Productivity report 2023: 

(105) The WIFO Radar of Competitiveness for the Austrian 

Economy 2023, WIFO-Monatsberichte, 2024. 

Austria’s sustainable competitiveness. 

(108) EIB Investment Survey – European Union Overview, 2023. 

52 

85909510010511011512012520162017201820192020202120222023AgricultureIndustryConstructionRetail, transport, accommodationInformation and communicationFinancial and insurance activities 
 
       
 
 
 
 
Material  shortages  are  now  back  to  pre-
pandemic levels, in line with global trends. In 
the  most 
recent  Business  and  Consumer 
Survey (109),  only  13.3%  of  industrial  companies 
still  viewed  the  lack  of  materials  as  the  most 
important  obstacle  for  production (see  Table 
A12.1). Supply chain shortages, however, continue 
to persist in some sectors, such as the automotive 
industry  or  machinery  production  (20%  of  all 
automotive 
firms  and  16%  of  mechanical 
engineering  firms  stated  that  material  shortages 
were  the  most  serious  impediment  in  the  fourth 
quarter of 2023).  

Austria  is  a  net  importer  of  energy  sources 
and  raw  materials,  and  energy-intensive 
industries  and  the  transport  sector  are 
particularly  affected.  Some  risks  stem  from 
continued  imports  of  natural  gas  from  Russia, 
which  were  still  around  60%  in  2023.  Austria  is 
highly  dependent  on  imports  of  raw  materials 
(only  wolfram  and  graphite  are  produced  and 
processed  in  Austria).  The  metalworking  industry 
and  electrical  industry  are  particularly  dependent 
on  raw  materials.  The  Master  Plan  for  Raw 
Materials 2030, published in December 2021, is in 
line  with  the  objectives  set  in  the  Critical  Raw 
Materials  Act (110).  Its  main  objectives  are  to 
secure  the  supply  of  primary  and  secondary 
mineral  raw  materials  in  Austria  and  strengthen 
supply  chains, 
the  circular 
economy. 

innovation  and 

in  Austria 

the  financing  costs  of  corporate 

Business  financing 
is  heavily 
concentrated  in  bank  loans,  while  equity 
financing  is  low  by  international  standards. 
The  rise in  interest  rates has  had  a major  impact 
on 
loans. 
According  to  the  Austrian  Central  Bank,  the 
average  interest  rate  for  corporate  loans  rose 
from  1.7%  in  June  2022  to  5.2%  in  September 
2023.  Increasing  borrowing  costs  in  connection 
with 
geopolitical 
reduced 
uncertainties 
demand for corporate loans. After corporate loans 
growth  reached  12.1%  in  August  2022  (the 
highest  level  in  the  last  25  years),  the  annual 

and 
drastically 

economic 

therefore 

existing 

(109) Business and Consumer Survey, European Commission, 

2023. 

(110) COM(2023) 160 – Proposal for a Regulation of the European 
Parliament and of the Council establishing a framework for 
ensuring a secure and sustainable supply of critical raw 
materials. 

53 

growth  rate  steadily  decreased  to  4.4% 
in 
September  2023.  However,  only  3.2%  of 
businesses  were  affected  by  credit  constraints  in 
2022, the lowest rate in the EU.  

Late  payments  have  been  increasing,  in  line 
with the EU average. On late payments, for 53% 
of Austrian companies it is increasingly difficult to 
agree  on  fair  payment  terms.  The  payment  gap 
increased  to  17  days  in  B2B  operations  in  2023 
(up  from  14 days in  2022)  and  15  days  with the 
public sector (up from 14 days the previous year), 
in  line  with  EU  averages  (see  Table  A12.1).  The 
share  of  SMEs  experiencing  late  payments  in  the 
last  6  months  has  also 
increased.  Austrian 
businesses are clearly worried about the impact of 
inflation on the economy and strongly believe that 
the  biggest  challenge  to  payment  behaviour  is 
rising inflation (70%, compared to the EU average 
of  59%),  followed  by  regulation  and  compliance 
(67%  of  Austrian  companies  compared  to  the  EU 
average  of  54%) (111).  Furthermore,  amid  lower 
household  and  corporate 
the 
consolidated  non-performing 
(NPL)  ratio 
remained  at  2%.  In  mid-2023,  the  NPL  ratios  of 
corporate and household loans came to 2.7% and 
2.2% respectively (112). 

indebtedness, 
loan 

Business insolvencies increased following the 
end  of  COVID  extraordinary  measures. 
According  to  the  Austrian  Central  Bank,  business 
insolvencies  increased  in  July  2023  compared  to 
July  2019 (113).  This  was  caused  by  the  phasing 
out  of  generous  and  very  unspecific  support 
schemes for businesses after COVID, which led to 
a marked decrease in insolvencies and an increase 
in  interest  rates  with  a  more  restrictive  credit 
policy by banks. 

Austria  is  experiencing  a  decline  in  its 
business  dynamism.  Enterprise  birth  and  death 
rates  are  among  the  lowest  in  Europe (114).  The 

(111) European Payment Report 2023, Intrum, 2023.  

(112) Oesterreichische National Bank, Financial Stability Report 46, 

2023. 

(113) Oesterreichische National Bank, Financial Stability Report 46, 

2023. 

(114) Enterprise Demography in the EU in 2021, Business 

Demography Statistics 2023, Eurostat. The latest data from 
Statistics Austria shows that the registration of legal units 
recorded in 2023 was 7% lower than in 2022. Although they 
are not equivalent to enterprise births, registrations are an 
important early indicator of economic development.  

 
 
 
share  of  start-ups  and  young  enterprises  is 
declining, having a negative impact on productivity 
(while the share of young enterprises was 5.4% in 
2013,  it  fell  to  3.8%  in  2020,  below  the  EU 
average).  The  share  of  high-growth  enterprises  is 
also  significantly  below  the  EU  average  (in  2021, 
8.21% in the number of enterprises and 7.29% in 
the number of employees compared to 9.18% and 
12.40% respectively in the EU). The introduction of 
a  new  capital  company  form  for  start-ups 
(‘FlexKap’) 
in  the 
Austrian  recovery  and  resilience  plan,  could  make 
the Austrian market more attractive.  

in  January  2024, 

included 

and 

companies 

The limited dynamism of the business sector 
and  supply  of  private  risk  capital  hinder 
technology 
innovative 
diffusion.  Supply  and  demand  of  risk  capital  is 
not  particularly  high 
in  Austria,  which  could 
hamper 
the  creation  and  growth  of  new 
innovative  enterprises. 
technology-intensive  or 
Limitations  on  access  to  venture  capital  finance 
are  affecting  innovative  SMEs  and  start-ups.  Risk 
capital  financing  is  underdeveloped,  with  private 
equity at only 0.14% of GDP in 2022, significantly 
below  the  EU  average  of  0.42%,  and  venture 
capital  was  0.041%  of  GDP 
(EU  average 
0.09%) (115).    

and 

The job vacancy rate in Austria is one of the 
highest 
in  the  EU.  Labour  shortages  are 
particularly  high  in  healthcare,  hospitality,  data 
processing 
and  mechanical 
electrical 
engineering.  Also,  around  three  quarters  of  SMEs 
in  Austria  experience  a  persistent  shortage  of 
specialised  professionals,  with  IT  being  a  notable 
example (116). At the same time, vocational training 
has been also declining in the last 10 years, while 
the  share  of  training  funded  by  companies  has 
decreased  from  40%  to  30%  of  total  vocational 
training  funding (117).  This  shortage  is  expected  to 
grow due to demographic changes and increasing 
demands  for  digitalisation:  for  example,  just  two 
thirds  of  SMEs  in  Austria  reach  at  least  a  basic 
level  of  digital  intensity,  slightly  below  the  EU 
average (and considerably below the EU target of 

(115) Investing in Europe: Private Equity Activity 2022, Invest in 

Europe, 2023. 

(116) Eurobarometer 529: European Year of Skills: Skills shortages, 
recruitment and retention strategies in small and medium-
sized enterprises, September 2023.  

(117) Financing of adult and continuing education in Austria and in 

selected comparative countries, AK Wien, 2022. 

90% for 2030). This means that there is untapped 
potential  to  improve  productivity  within  specific 
sectors  by  increasing  digital  intensity  (see  also 
Annex 10 and 14).  

The export-oriented green tech sector is one 
of  the  fast-growing  sectors  in  the  Austrian 
economy. In 2022, Austria ranked third in the EU 
Eco-Innovation  Index.  While  it  is  a  leader  in  the 
deployment  of  renewable  energy,  with  over  80% 
of  its  electricity  mix  coming  from  renewables, 
significant  investments  are  still  required  to  reach 
electricity 
the  goal  of  100% 
consumption  by  2030.  Hydropower,  solar  thermal 
energy, heat pumps, plant engineering and energy 
management  could  be  the  basis  of  Austria’s  net 
for  more 
(see  Annex  7 
zero 
information on clean tech in Austria).  

technologies 

renewable 

investments. 

Industry  is  central  to  the  Austrian  economy, 
but  to  stay  competitive  requires  substantial 
green 
Industry  accounted  for 
21.8%  of  gross  value  added  and  15.7%  of  total 
employment  in  2023  (compared  to  20.6%  and 
is  huge  economic 
15.4% 
importance  attached  to  hard-to-abate  sectors 
(steel,  chemical  industry),  so  improvements  in 
energy  efficiency  and  decarbonisation  are 
important to preserve competitiveness in industrial 
processes in Austria (see Graph A12.2).  

in  the  EU).  There 

Graph A12.2: Value added and employment in 
industry (% total) 

Source: Eurostat 

Complex  and  lengthy  spatial  planning  and 
permitting procedures have a negative effect 
on  investment,  especially  in  the  renewable 
energy  sector.  The  federal  states  have  far-
reaching competences in many areas (building law, 
spatial  planning  etc.),  which  usually  leads  to 
different  procedures  and  complex  requirements. 
One  ongoing  project  as  part  of  the  Single  Market 
Enforcement  Taskforce  (SMET)  aims  to  remove 

54 

1013161922252014201520162017201820192020202120222023EU - 27 Empl IndustryAustria Empl IndustryEU - 27 VA IndustryAustria VA Industry 
 
   
its resolution rate without these cases would have 
been 83.7%. 

Austria  has  reached  the  production  stage 
with 
the  Once-Only  Technical  System 
(OOTS) (121),  showcasing  its  capability  to  perform 
first  live  OOTS  transactions.  As  part  of  the  Single 
Digital  Gateway  Regulation (122),  the  system  will 
enable  the  automated  cross-border  exchange  of 
authorities, 
evidence 
improving 
information, 
access 
administrative  procedures  and  assistance  within 
the  EU.  The  onboarding  of  Austrian  competent 
authorities  is  crucial  for  the  system  to  function 
smoothly and to reduce administrative burden.   

competent 
to 

between 
online 

several  process-related  barriers  to  renewable 
energy permitting, particularly the lack of staff or 
technical capacity, but also extensive requirements 
and  delays 
in  administrative  processes.  High 
planning predictability is an important prerequisite 
for the implementation of investment projects. 

Austria is strongly integrated into the Single 
Market,  and  the  regulatory  framework  is 
favourable for businesses. Austria’s exports are 
relatively diversified, with about 80% going to the 
EU. 
In  addition,  according  to  the  European 
Investment  Bank (118)  government  regulation  and 
administrative  requirements  are  in  line  with  EU 
standards.  Nevertheless,  there  is  still  some  scope 
for  further  improvement,  including  on  ongoing 
infringement cases relevant for the Single Market. 
The average duration of infringement proceedings 
is around 50 months, higher than the EU average. 
On public procurement, Austria performs quite well 
overall: the percentage of bids with just one offer 
is  27%,  slightly  below  the  EU  average,  and  the 
rate of direct awards is just 7% (see Table A12.1).  

in  Austria 

is 
Regulatory  restrictiveness 
higher  than  the  EU  average  for  many 
regulated  professions,  especially  for  architects 
and  civil  engineers.  These  access  barriers  and 
restrictive  rules  include  among  others  extensive 
reserved activities and interdisciplinary restrictions. 
Moreover,  Austria  remains  among  the  most 
restrictive Member States in retail operations (119). 
The  Austrian  Federal  Competition  Authority  also 
recently  pointed  to  high  market  concentration  as 
well as higher prices compared to other countries, 
territorial  supply 
which 
constraints (120). 

result 

could 

from 

Austria  is  generally  well  positioned  in  terms 
of  digital  services  and  e-government  (see 
Annex  13).  It  has  expanded  digital  public  services 
for  the  business  sector  significantly,  generally 
following  the  ‘once-only’  principle.  Austria  solved 
70%  of  the  SOLVIT  cases  (98)  it  handled  as  lead 
centre,  below  the  EU  average  of  88%  (see  Table 
A12.1).  However,  many  of  the  unresolved  cases 
are  due  to  a  systemic  issue  related  to  difficulties 
with  applications  for  family  benefits.  Indicatively, 

(118) EIB Investment Survey – European Union Overview, 2023. 

(119) Retail restrictiveness Indicator, European Commission, 2022.  

(120) Sector Inquiry Food, Austrian Federal Competition Authority 

(121) Implementing Regulation (EU) 2022/1463. 

(AFCA), November 2023. 

(122) Regulation (EU) 2018/1724. 

55 

 
 
 
Table A12.1:Single Market and Industry 

Source: (1) AMECO, (2) Eurostat, (3) Single Market Scoreboard, (4) OECD, (5) COMEXT and Commission calculations, (6) EIB 
Investment Survey, (7) Intrum Payment Report, (8) SAFE survey, (9) EIF SME Access to Finance Index 
* Own Commission calculations for the EU27 average  

56 

POLICY AREAINDICATOR NAME20192020202120222023EU27 average*Net Private investment, level of private capital stock, net of depreciation, % GDP164,55,34,93,83,8Net Public investment, level of public capital stock, net of depreciation, % GDP10,60,60,80,70,81,2Real labour productivity per person in industry (% yoy)2-0,7-5,610,42,7-3,6-1,24Cost competitivenessNominal unit labour cost in industry (% yoy)23,35,5-6,52,411,69,83Single Market integrationEU Trade integration, % (Average intra-EU imports + average intra EU exports)/GDP237,834,538,342,338,742,9Transposition deficit, % of all directives not transposed30,71,21,9110,7Conformity deficit, % of all directives transposed incorrectly321,91,51,21,41,1SOLVIT, % resolution rate per country375,375,874,471,970,088,3Number of pending infringement proceedings3273535292425,9RestrictionsEEA Services Trade Restrictiveness Index40,060,060,060,060,060,05Single bids, % of total contractors3242225292728,6Direct Awards, %321310778,1Material Shortage (industry), firms facing constraints, %59,05,028,335,213,317,2Labour Shortage using survey data (industry), firms facing constraints, %516,17,014,521,418,023,3Vacancy rate, % of vacant posts to all available ones (vacant + occupied)23,73,14,35,85,12,5Concentration in selected raw materials, Import concentration index based on a basket of critical raw materials60,20,170,170,20,20,22Installed renewables electricity capacity, % of total electricity produced20,80,80,80,850Investment obstaclesImpact of regulation on long-term investment, % of firms reporting business regulation as major obstacle735,829,235,426,030,022,2Bankruptcies, Index (2015=100)2-----105,6Business registrations, Index (2015=100)2-----120,2Payment gap - corporates B2B, difference in days between offered and actual payment8-1412141715Payment gap - public sector, difference in days between offered and actual payment8-1212141516Share of SMEs experiencing late payments in past 6 months, %938,230,430,432,342,148,7EIF Access to finance index - Loan, Composite: SME external financing over last 6 months, index values between 0 and 1100,730,720,730,70-0,49EIF Access to finance index - Equity, Composite: VC/GDP, IPO/GDP, SMEs using equity, index values between 0 and 110 0,150,080,120,12-0,17AustriaHEADLINE INDICATORSEconomic StructureSINGLE MARKETCompliancePublic procurement ECONOMIC STRUCTUREShortagesStrategic dependenciesBUSINESS ENVIRONMENT - SMEsBusiness demographyLate paymentsAccess to finance 
 
      
 
ANNEX 13: PUBLIC ADMINISTRATION 

Austria’s  public  administration  is  essential 
for  the  economy’s  competitiveness  by,  in 
particular,  shaping  the  conditions  for  the 
twin  transitions  and  creating  a  favourable 
business  environment.  The  perception  of 
government  effectiveness  in  Austria  has  stayed 
above  the  EU  average (Graph  A13.1)  despite 
challenges 
in  state  coordination  of  public 
administration reforms. The government continues 
to 
implement  the  reform  objectives  of  the 
Responsible  for  Austria  2020-2024  programme. 
This 
process 
simplification,  development  of  synergies  across 
different  levels  of  government,  transparency,  and 
the  attractiveness  of  the  civil  service  as  an 
employer in relation to the private sector (123). 

digitalisation, 

focuses 

on 

Graph A13.1: Government effectiveness 

Average value over 2018-2022 and change over 2018-2022. 
The GDP per head bar shows the mean value of the 
government effectiveness indicator for the group of EU 
countries belonging to the same GDP per head cluster as 
Austria (EU countries are ranked in terms of their GDP per 
head and grouped into three equally sized clusters). 
Source: Worldwide Governance Indicators 

The adoption of COVID-19 support measures 
sparked  further  discussions  on  evidence-
informed policymaking, which has had mixed 
results  in  Austria.  While  there  are  no  central 
coordination bodies or institutions in place, such as 
a  chief  scientific  officer,  impact  assessments  are 
used  to  promote  evidence-informed  policymaking 

(123) Bundeskanzleramt, Aus Verantwortung für Österreich. 

in  the  legislative  process. (124).  In  addition,  the 
recommendations of various independent advisory 
bodies,  such  as  the  Fiscal  Council,  are  widely 
discussed  but  only  partially  implemented.  The 
impact  of  recent  reforms  aimed  at  improving 
public  consultations  for  all  legislative  proposals 
throughout the legislative process is yet to be felt. 

Austria has implemented a novel approach to 
policymaking  on  climate  issues,  with  a  newly 
formed  Citizens’  Climate  Assembly  developing 
suggestions for climate-related measures (125). The 
Ministry of Finance has begun to engage in green 
budgeting at federal level, starting with a focus on 
its implementation in the ministry (126). 

Digitalisation efforts have a strong focus on 
the  use  of  artificial  intelligence  (AI)  in  the 
public  administration.  Government  agencies 
have  drawn  up  several  reports  examining  the 
opportunities  and  challenges  of  AI,  its  ethical  use 
and  practical  guidance  for 
its  use  by  civil 
servants (127).  In  terms  of  service  delivery,  Austria 
ranks  close  to  the  EU  average  in  people’s  use  of 
websites for government activities. The launch of a 
new  online  identity  app  at  the  end  of  2023  is 
expected  to  increase  access  to  administrative 
procedures by using biometric identification (128). 

The civil service will experience a retirement 
wave  in  the  next  13  years,  even  though  the 
proportion of public sector staff over the age 55 is 
currently  below  the  EU  average.  In  response,  the 
government is working to boost the attractiveness 

(124) Ministry for Arts, Culture, Public Service and Sport (n.d.), 

Wirkungsorientierte Folgenabschätzung, 
https://oeffentlicherdienst.gv.at/wirkungsorientierte-
verwaltung/wirkungsorientierte-folgenabschaetzung/. 

(125) See Ministry for Climate and the Environment (n.d.), ‘Klimarat 

der Bürgerinnen und Bürger’. Available at: 
https://www.bmk.gv.at/themen/klima_umwelt/klimaschutz/na
t_klimapolitik/klimarat.html (Accessed on 07/12/2023). 

(126) Ministry of Finance (2023), ‘Green Budgeting im 
Bundesministerium für Finanzen’. Available at: 
https://www.bmf.gv.at/themen/klimapolitik/green_Budgeting/
green_budgeting-
/green_budgeting_im_bundesministeriums_f%C3%BCr_finan
zen.html (Accessed on 07/12/2023). 

(127) Ministry for Arts, Culture, Public Service and Sport (2023), 
Leitfaden – Digitale Verwaltung und Ethik – Öffentlicher 
Dienst (oeffentlicherdienst.gv.at) 

Regierungsprogramm 2020-2024, 
https://www.bundeskanzleramt.gv.at/bundeskanzleramt/die-
bundesregierung/regierungsdokumente.html. 

(128) European Commission, DG REFORM, Public administration 

and governance: Austria, Publications Office of the EU, 2024 
(forthcoming). 

57 

-0.20.00.20.40.60.81.01.21.41.61.8ATEU-27GDP perhead clusterChange 2018-2022Average 2018-2022 
 
   
 
 
 
Table A13.1:Public administration indicators 

(1) High values denote a good performance, except for indicator # 6. (2) 2023 value. If unavailable, the latest value available is 
shown. (3) Measures the user centricity (including for cross-border services) and transparency of digital public services as well as 
the existence of key enablers for the provision of those services. (4) Defined as the absolute value of the difference between the 
percentage of men and women in senior civil service positions. 
Flags: (b) break in time series; (d) definition differs; (u) low reliability. 
Source: E-government activities of individuals via websites, Eurostat (# 1); E-government benchmark report (# 2); Open data 
maturity report (# 3); Labour Force Survey, Eurostat (# 4, 5, 7); European Institute for Gender Equality (# 6); Fiscal Governance 
Database (# 8, 9); OECD Indicators of Regulatory Policy and Governance (# 10). 

of  the  public  sector  by  opening  up  to  candidates 
from  the  private  sector  and  increasing  initial 
pay (129).  Gender  parity  in  senior  civil  service 
positions  is  still  lagging  slightly  behind  the  EU 
average but continues on the upward trend of the 
past  few  years.  Lastly,  the  government  aims  to 
address the skills gap in the public administration 
by  launching  the  Austrian  School  of  Government, 
which will help to match the skills requirements of 
the  workplace  with  the  curricula  of  training 
institutions.  

In  providing  open  government  data,  Austria 
performs above the EU average (Table A13.1).  
A  new  legislation  proposal  was  adopted  that 
replaces  the  official  secrecy  obligation  with  the 
information  and  will  be 
individual’s  right  to 
applicable  as  of  September  2025.  Nevertheless, 

discussions  on  the  effectiveness  of  the  proposal 
and its exemptions continue. 

The  justice  system  works  efficiently  overall. 
Disposition  times  in  litigious  civil  and  commercial 
cases remain very low (142 days at first instance 
in  2022).  Austria  has  continued  to 
improve 
administrative  cases  in  recent  years,  with  a 
relatively high clearance rate (112% in 2022) and 
a  continued  reduction  in  disposition  times  (288 
days in 2022 compared to 312 in 2021). The level 
of  digitalisation  is  very  advanced  although  there 
are  still  some  gaps  in  the  implementation  of 
certain 
independence,  no 
judicial 
systemic deficiencies have been reported (130). 

tools.  On 

(129) European Commission, DG REFORM, Public administration 

and governance: Austria, Publications Office of the EU, 2024 
(forthcoming). 

(130) For a more details, see the 2024 EU Justice Scoreboard and 
the Commission’s 2024 Rule of Law Report (forthcoming). 

58 

AT20192020202120222023EU-27(2)1n/an/an/a78.579.075.02n/a84.176.377.881.175.830.70.90.90.80.90.8438.138.038.9 (b)41.241.952.9518.313.117.8 (b)20.322.717.9620.622.019.016.416.89.271.31.41.4 (b)1.51.41.580.60.70.70.7n/a0.791.21.21.21.2n/a1.410n/an/a1.86n/an/a1.7Medium-term budgetary framework indexIndicator (1)E-government and open government dataShare of internet users within the last year that used a public authority website or appE-government benchmark overall score (3) Open data and portal maturity indexEducational attainment level, adult learning, gender parity and ageingShare of public administration employees with higher education (levels 5-8, %)Participation rate of public administration employees in adult learning (%)Gender parity in senior civil service positions (4)Ratio of 25-49 to 50-64 year olds in NACE sector OPublic financial management Strength of fiscal rules indexEvidence-based policy makingRegulatory governance 
 
 
 
       
 
FAIRNESS 
ANNEX 14: EMPLOYMENT, SKILLS AND SOCIAL POLICY CHALLENGES IN LIGHT OF 
THE EUROPEAN PILLAR OF SOCIAL RIGHTS 

The  European  Pillar  of  Social  Rights  is  the 
compass  for  upward  convergence  towards 
better  working  and  living  conditions  in  the 
EU.  This  Annex  provides  an  overview  of  Austria’s 
progress in implementing the Pillar’s 20 principles 
and the EU headline and national targets for 2030 
on employment, skills and poverty reduction. 

Table A14.1:Social Scoreboard for Austria 

was  at  a  high  level  in  absolute  terms  (73.3%). 
However, at the same time Austria had one of the 
widest  gender  gaps  in  part-time  employment  in 
the EU at 38.6 pps, with more than half of women 
working  part-time,  significantly  contributing  to 
gender  pay  disparities.  In  2022,  the  unadjusted 
gender  pay  gap  narrowed  slightly  by  0.4  pps  and 
stood  at  18.4%.  The  gender  pension  gap  was 
34.4%, well above the EU average of 26%. Unpaid 
care  work,  and  a  lack  of  affordable  and  high-
quality early childhood education and care (ECEC), 
are  key  reasons  to  explain  the  gender  pay  gap. 
Only  24.1%  of  children  under  3  years  of  age 
participated  in  ECEC  in  2023,  reflecting  only  a 
minor  increase  of  1.1  pps  year-on-year  and 
significantly  below  the  national  Barcelona  target 
of  31.9%.  Moreover,  one  in  four  children  in  low-
income  families  live  in  households  that  report  an 
unmet  need  for  childcare  services (131).  Additional 
measures 
the  European  Child 
Guarantee,  together  with  the  financial  support 
committed  under  the  Austrian  recovery  and 
resilience  plan  (RRP)  and  the  ESF+  intended  to 
improve  the  availability  of  ECEC  can  increase  the 
labour market participation of women.   

line  with 

in 

Labour  and  skills  shortages  remain  among 
the  highest  in  the  EU  and  are  impacting 
growth,  investment  and  innovation.  Together 
with the underrepresentation of various groups on 
the  labour  market  and  in  education  and  the 
challenges posed by the lack of certain skills, these 
shortages  undermine  Austria’s  efforts  to  improve 
its  economic  competitiveness.  While  the 
job 
vacancy rate fell by 0.6 pps year-on-year to 4.7% 
in  2023,  it  was  still  one  of  the  highest  in  the  EU 
and has stayed above 4% since the end of 2021. 
Shortages  were  particularly  prevalent 
in  the 
service  and  construction  sectors.  Around  25%  of 
construction companies said that they faced staff 
In  2023,  62%  of 
shortages 
entrepreneurs  in  Austria  said  that  they  were 
severely  impacted  by  shortages.  Almost  half  said 
that this hampered innovation and more than half 
experienced declining revenues as a result (132). An 
ageing society, changing skills requirements in the 

in  Q3-2023. 

(131) OECD, Childhood socio-economic disadvantage in Austria: A 

snapshot of key challenges (oecd-ilibrary.org), 2023. 

(132) WKO Fachkräfte-Radar: Gemeinsam Fachkräfte sichern, 

2023. 

(1) Update of 27 October 2023. Members States are 
categorised based on the Social Scoreboard according to a 
methodology agreed with the EMCO and SPC Committees. 
Please consult the Annex of the Joint Employment Report 
2024 for details on the methodology. 
Source: Eurostat. 

Despite  a  weakening  economy,  Austria’s 
labour market proves to be robust. Throughout 
2023  the  employment  rate  remained  stable  and 
decreased  by  only  0.1 pps  to  77.2%  compared  to 
the  previous  year,  remaining  close  to  the  2030 
national target on employment. With the increased 
participation  of  women  and  older  workers  in  the 
labour  force,  employment  is  expected  to  grow  in 
2024.  While  the  unemployment  rate  increased  by 
0.3  percentage  points  (pps)  year-on-year  to  5.1% 
in 2023, it is expected to stabilise at around 5.3% 
in 2024.  

The 
labour  market  potential  of  women 
remains  underused,  with  significant  hurdles 
persisting. The female employment rate in 2023 

59 

52.28.664.79.47.84.377.25.11.199.417.521.641.9623.87.4230.5Critical situationTo watchWeak but improvingGood but to monitorOn averageDynamic labour markets and fair working conditionsEmployment rate(% of the population aged 20-64, 2023)Unemployment rate(% of the active population aged 15-74, 2023)Long term unemployment(% of the active population aged 15-74, 2023)Gross disposable household income (GDHI) per capita growth(index, 2008=100, 2022)Social protection and inclusionAt risk of poverty or social exclusion (AROPE) rate (% of the total population, 2022)At risk of poverty or social exclusion (AROPE) rate for children(% of the population aged 0-17, 2022)Impact of social transfers (other than pensions) on poverty reduction(% reduction of AROP, 2022)Disability employment gap (percentage points, population aged 20-64, 2022)Housing cost overburden (% of the total population, 2022)Children aged less than 3 years in formal childcare (% of the under 3-years-old population, 2022)Self-reported unmet need for medical care (% of the population aged 16+, 2022)Better than averageBest performersPolicy areaHeadline indicatorEqual opportunities and access to the labour marketAdult participation in learning (during the last 12 months, excl. guided on the job training, % of the population aged 25-64, 2022)Early leavers from education and training(% of  the population aged 18-24, 2023)Share of individuals who have basic or above basic overall digital skills(% of the population aged 16-74, 2023)Young people not in employment, education or training(% of the population aged 15-29, 2023)Gender employment gap(percentage points, population aged 20-64, 2023)Income quintile ratio (S80/S20, 2022) 
 
 
 
   
 
 
 
continuously 

context  of  the  twin  green  and  digital  transitions, 
and existing skills mismatches are all factors that 
explain  these  shortages (133).  Austria’s  vocational 
education  and  training  (VET)  system,  which  is 
being 
supports 
sustainability  and  targets  the  green  transition. 
Under  the  national  implementation  plan  of  the 
Council  recommendation  on  VET,  Austria  aims  to 
fill  the  shortage  of  skilled  labour,  improve  the 
attractiveness  of  VET,  and  make  non-formal 
qualifications  and 
learning  more 
attractive. 

developed, 

informal 

Table A14.2:Situation of Austria on 2030 
employment, skills and poverty reduction targets 

(1) Adult Education Survey, adults in learning in the past 12 
months, special extraction excl. guided on-the-job training. 
(2) Change in the number of persons at risk of poverty or 
social exclusion (AROPE), reference year 2019. 
Source: Eurostat, DG EMPL. 

increased  continuously  over  the 

Despite  widespread  labour  shortages  and 
skills  mismatches,  some  groups  are  still 
underrepresented  on  the 
labour  market. 
Although  the  employment  rate  of  older  workers 
last 
(55-64) 
decade  to  reach  57.3%  in  2023,  it  remains  well 
below the EU average of 63.9%. With fewer digital 
skills  and  often  facing  discriminatory  practices 
because of their age, it is difficult for workers over 
55  to  be  reintegrated  in  jobs.  People  with  a  low 
level  of  skills  are  particularly  vulnerable  and 
represent 
the 
highest 
unemployed (134). Their employment rate of 55.6% 
in 2023 is 21.6 pps below the overall employment 
rate. While people born in another EU country have 
almost the same employment rate as people born 
in  Austria,  those  born  outside  the  EU  face 
significant  obstacles  in  the  labour  market.  At 
65.7%  in  Q3-2023,  their  employment  rate  was 
13.3  pps  below  the  rate  of  those  born  in  Austria. 
Tackling  their  unused  labour  market  potential,  in 
particularly by improving skill levels, can contribute 
to  addressing  labour  shortages  and  reaching  the 

share 

the 

of 

2030  targets  on  employment  and  skills.  National 
measures,  such  as  the  ‘Joboffensive  50plus’, 
increased  funding  to  integrate  refugees  and  the 
Austrian  RRP,  focus  on  improving  labour  market 
outcomes  for  older  workers,  the  low-skilled  and 
migrants. The ‘Funding for reskilling and upskilling’ 
programme,  together  with  the  ‘one-stop  shop’  for 
guidance  on  adult  learning  aim  to  improve  the 
skills  of  people  with  no  or  few  qualifications  and 
reduce barriers to adult learning.  

A young person’s socio-economic background 
has  a  major  impact  on  their  educational 
performance  and  social  integration,  and  on 
getting them  into  work  or  training.  The  share 
of  early  young  people  (aged  18-24)  who  leave 
education  or  training  early  (ELET)  increased  in 
2023  to  8.6%,  which  is  better  than  the  EU-level 
target  of  under  9%.  Young  people  born  outside 
Austria and people living in cities are more likely to 
leave education and training early (135). Preventing 
young people from leaving education and training 
early  is  key  to  reducing  various  risks  in  their 
future,  including  unemployment,  inactivity  and 
employment  in  low-paid  jobs  with  few  or  no 
prospects  for  training  and  career  progression. 
Considering 
the  socio-
economic  background  plays  in  the  labour  market 
integration, particularly given the strong shortages 
of  labour,  further  investment  in  education  may 
help,  especially  to  cope  with  the  challenges  of 
increased diversity, e.g. through German language 
support,  and  to  provide  tailored  adult  education 
measures.  

the  difficulties 

that 

a 

indicators 

demonstrate 

Austria’s  social  security  system  has  shown 
stability  over  time.  While  minimum  income 
schemes,  unemployment  assistance  and  other 
benefits  offer  adequate  coverage  in  Austria (136), 
slowly 
some 
deteriorating  trend.  As  high  energy  prices  put 
pressure  on  low-income  households  (Annex  8),  in 
2023,  the  share  of  people  at  risk  of  poverty  or 
social exclusion (AROPE) reached an 8-year high at 
17.7%, and the rate of severe material and social 
deprivation  markedly  increased  by  1.4  pps  to 
3.7%.  Single-parent  households  and  people  born 
outside the EU are particularly at risk of poverty or 
social  exclusion.  In  2023,  almost  half  of  single 
parent  households  (45.3%)  were  at  risk.  At  the 

(133) Statistik Austria, Fachkräftebedarf in Österreich, 2023. 

(135) Education And Training Monitor 2023. 

(134) AMS, Arbeitsmarkt und Bildung, 2022. 

(136) Minimum income report, 2022. 

60 

IndicatorsLatest dataTrend            (2016-2023)2030 targetEU target 77.2(2023)52.2(2022)158(2023)Poverty reduction2 (thousands)-204-15,000Employment (%)79.978Adult learning1 (%)6260 
 
  
 
 
 
same  time,  the  situation  of  children  at  risk  of 
poverty  or  social  exclusion  worsened  slightly  with 
the share of children born outside Austria who are 
at  risk  remains  substantially  higher  than  for 
Austrian nationals. Further policy action to support 
single  parents  and  those  at  risk  of  poverty, 
particularly  children,  can  help  achieve  the  2030 
poverty reduction target. 

61 

 
ANNEX 15: EDUCATION AND TRAINING 

This  Annex  outlines  the  main  challenges  of 
Austria’s  education  and  training  system 
based on the 2023 Education and Training Monitor 
and  the  2022  OECD  Programme  for  International 
Student Assessment (PISA) results. 

The socio-economic gap in underachievement 
in  basic  skills  has  widened  since  2012. 
According  to  PISA  2022,  the  proportion  of  low-
achieving  students  in  mathematics  and  reading 
has  continuously  increased  since  2012.  The  15% 
EU  target  was  not  met  in  mathematics  (24.9%), 
(22.7%). 
or 
reading 
Underachievement  has 
in  particular 
among students from disadvantaged and migrant 
backgrounds.  In  2022,  45.1% (137)  of  students 
from  disadvantaged  background  did  not  reach  a 
minimum  proficiency  level  in  mathematics  (vs 
35.1% in 2012). Similarly, 45.4% of students born 
abroad underachieve (vs 37.8% in 2012). 

increased 

(25.3%) 

science 

The  share  of  top-performing  students  is 
above  the  EU  average.  In  2022  10.3%  of 
Austrian students reach the highest levels in PISA 
in  mathematics  and  7.9%  in  reading  and  7.7%  in 
science,  above  the  EU  average  in  all  three  fields. 
However,  their  share  fell  in  mathematics  since 
2012  by  about  a  third  (4.0 pps).  It  increased  in 
reading  (2.2 pps)  and  remained  unchanged  in 
science. This trend is roughly in line with EU trends. 
Both  the  increase  in  underperformance  and  the 
reduction in the share of top-performing students 
may  present  risks  to  successfully  addressing 
labour  shortages,  and  so  hampering  innovation 
capacity and competitiveness. 

Serious  staff  shortages  exist 
in  early 
childhood  education  and  care  (ECEC)  and  in 
compulsory 
Teacher 
education. 
school 
in  certain 
shortages  are  already  pronounced 
subjects  and  regions.  In  ECEC,  the  continuous 
expansion of supply combined with policy action to 
increase  quality  is  expected  to  increase  the  need 
for  additional  staff  by  at  least  20 200  people  by 
2030 (138). Despite comparatively high salaries and 
attractive  working  conditions (139),  it  is  difficult  to 
recruit and train sufficient staff for ECEC. Over one 
fourth  of  all  teachers  in  Austria  are  aged  55  or 
more,  while  the  number  of  pupils  in  compulsory 

(137) PISA 2022 bottom quarter. 

(138) Löffler, R. et al. (2022) Bildungs- und Berufsverläufe  

education  is  expected  to  increase  by  5-7%  up  to 
2030 (140).  The  government  is  taking  measures  to 
improve 
teaching 
profession,  to  improve  working  conditions,  and  to 
reform  and  shorten  teacher  education,  while 
facilitating lateral entry into the profession. 

the  attractiveness  of 

the 

Graph A15.1: Underachievement rates by field, 
PISA 2012, 2018 and 2022 

Source: OECD (2023). 

Ensuring  equal  opportunities  and  improving 
basic  skills  and  digital  learning  are  high  on 
Austria’s national education agenda.  The rate 
of  early  leavers  from  education  and  training 
remained at 8.6% in 2023, below the EU average 
and already reaching the EU-level target. However, 
the rate for non-EU foreign-born pupils (15.2%) is 
about  two  times  higher  than  the  rate  for  native-
born (6.8%). Several initiatives have been taken to 
improve access to quality education, especially for 
include  support 
disadvantaged  pupils.  These 
through multi-professional teams (2017-2022) for 
500  primary  and  compulsory  secondary  schools 
facing  challenges,  as  well  as  the  ‘100  Schools  – 
1 000  Opportunities’  initiative,  which  has  been 
extended  to  2024.  In  2023,  Austria  reformed  the 
curricula 
to  promote  acquisition  of  basic 
competences and to modernise teaching methods. 
It has also taken measures to narrow the learning 
gaps  that  opened  up  during  the  COVID-19 
pandemic. The nationwide standardised instrument 
for  assessing  core  competences,  introduced  in 
2022,  aims  to  strengthen  basic  skills.  It  seeks  to 
boost  learning  of  the  German  language  by  the 
continued  development  of  German-language 
support measures, including a reading strategy. 

Participation  in  early  childhood  education 
and  care  (ECEC)  remains  below  the  EU 
average and the EU target. The participation 

(139) European Education and Training Monitor Austria 2023.  

(140) National Education Report Austria 2021. 

62 

0.05.010.015.020.025.030.035.0ATEUATEUATEUMathematicsReadingScience%2012201820222030 EU target 
 
 
  
 
 
 
Table A15.1:EU-level targets and other contextual indicators under the European Education Area 
strategic framework 

Notes: b = break in time series; d = definition differs; e = estimated; p = provisional; u = low reliability; : = data not available. 
Source: 1,3,4,5,7,8,9,10,12=Eurostat; 11= Eurostat, Adult Education Survey; 2,6=OECD, PISA. 

influenced  by  students’  background.  In  2023, 
43.5% of young people aged 25-34 held a tertiary 
degree  and  over  the  last  decade,  the  attainment 
rate  has  almost  doubled  (from  22.8%  in  2012). 
Similarly,  to  the  EU  trend,  the  rate  for  women 
(48.1%)  is  higher  than  for  men  (39.1%).  Young 
people  from  a  disadvantaged  socio-economic 
and/or  migrant  background  are  less  likely  to 
complete higher education studies than their more 
advantaged  peers.  The  2017  national  strategy  on 
the  social  dimension  in  higher  education  aims  to 
make  higher  education  more  inclusive.  The  2022 
mid-term 
qualitative 
improvements  and  many  measures  taken  by 
higher  education  institutions  regarding  outreach, 
but  not  enough  progress  on  national  quantitative 
targets. 

evaluation 

shows 

Overall,  Austria  has  a  very  good  vocational 
education  and  training  system,  which  is  also  the 
case  for  the  adult  learning  system,  but  skills 
shortages and inequalities do exist (see Annex 14). 

rate  for  children  between  the  age  of  3  and  the 
compulsory  primary  schooling  age  was  89.0%  in 
2021  and  has  remained  largely  stable  since 
2017 (141). It is 3.5 pps below the EU average and 
7 pps below the EU-level target  of 96% by 2030. 
In  2022,  the  federal  government  concluded  a  5-
year  agreement  with  the  federal  states,  including 
a  40%  increase  of  the  annual  federal  budget 
contribution  (EUR 200  million),  matched  by  an 
annual  contribution  of  EUR 63  million  from  the 
regions. Key objectives are to continue compulsory 
participation of 5-year-olds in ECEC, to extend the 
offer  of  ECEC  places,  to  promote  early  language 
learning  and  to  increase  the  share  of  places  for 
under-3-year-olds.  While  the  agreement  offers 
opportunities for quality improvement, it still falls 
short  of  establishing  a  comprehensive  quality 
framework.  The  Recovery  and  Resilience  Facility 
also  supports the  extension  of  available  places  in 
ECEC (see Annex 3). 

Austria  continues  to  increase  the  tertiary 
is  strongly 
attainment  rate,  but  access 

(141) Eurostat: educ_uoe_enra21. 

63 

96%86.5%201391.8%201389.7%92.2%89.0%202192.5%2021,dReading< 15%19.5% 18.0%23.6% 22.5%25.3%202226.2%2022Mathematics< 15%18.7% 22.1%21.1%22.9%24.9%202229.5%2022Science< 15%15.8% 16.8%21.9%22.3%22.7%202224.2%2022< 9 %7.8%12.6%7.3%10.5%8.6%9.5%Men8.0%14.5%8.9%12.1%9.3%11.3%Women7.6%10.6%5.7%8.7%7.9%7.7%Cities10.6%b11.2%10.1%9.4%11.3%8.6%Rural areas5.1%b14.0%4.4%11.0%6.1%9.9%5By country of birthNative6.2%11.3%5.5%9.2%6.8%8.2%EU-born9.7%u26.2%10.7%u22.4%16.8%21.0%Non EU-born22.0%30.1%22.2%23.0%15.2%21.6%6Socio-economic gap (percentage points)28.7:27.829.537.8202237.220227Exposure of VET graduates to work-based learning≥ 60% (2025) ::: :91.2% 64.5%45%22.8%34.1%40.5%38.7%43.5%43.1%Men21.3%29.1%36.1%33.3%39.1%37.6%Women24.3%39.2%44.9%44.2%48.1%48.8%Cities31.8%b43.5%48.7%49.0%52.6%53.3%Rural areas15.8%b24.8%34.4%27.7%36.9%31.7%Native23.2%35.4%42.0%39.7%43.6%44.2%EU-born30.7%29.3%46.0%36.7%50.1%40.2%Non EU-born14.7%24.2%28.8%31.0%37.9%37.1%11Participation in adult learning (age 25-64)≥ 47% (2025) ::55.3%201637.4%201652.2%202239.5%202223.5%201322.7%201328.0%23.8%27.3%202124.5%2021Tertiary educational attainment (age 25-34)8Total8By gender9By degree of urbanisation10By country of birth12Share of school teachers (ISCED 1-3) who are 55 years or over1Participation in early childhood education (age 3+)2Low-achieving 15-year-olds in:Early leavers from education and training(age 18-24)3Total3By gender4By degree of urbanisation201220182023IndicatorTargetAustriaEU-27AustriaEU-27AustriaEU-27 
 
 
  
 
ANNEX 16: HEALTH AND HEALTH SYSTEMS 

A  healthy  population  and  an  effective, 
accessible  and  resilient  health  system  are 
prerequisites  for  a sustainable  economy and 
society.  This  Annex  provides  a  snapshot  of 
population health and the health system in Austria. 

in  2022 (142).  However, 

In 2022, life expectancy in Austria was above 
the EU average. Compared to the previous years, 
life  expectancy  increased  slightly  in  2022,  partly 
due  to  a  considerable  reduction  in  the  number  of 
COVID-19  deaths 
life 
expectancy is still below its pre-pandemic levels. In 
general,  treatable and preventable mortality rates 
are  lower  than  the  EU  average.  In  2021,  the 
leading causes of death were, as before, diseases 
of 
(‘cardiovascular 
diseases’)  followed  by  cancer  and  COVID-19. 
Cancer  mortality  rates  were  lower  than  the  EU 
average. 

circulatory 

system 

the 

care.  Provisional  data  suggest  that  in  2022,  total 
healthcare  spending  fell  back  to  11.4%  of  GDP. 
Based  on  the  age  profile  of 
the  Austrian 
population,  public  spending  on  health  is  projected 
to increase by 1.2 percentage points (pps) of GDP 
by 2070 (compared to 0.6 pps for the EU overall), 
raising  medium-term  and 
fiscal 
long-term 
sustainability  concerns 
(see  Graph  16.2  and 
Annex 21). 

Graph A16.2: Projected increase in public 
expenditure on healthcare over 2024-2070 

Graph A16.1: Life expectancy at birth, years 

Baseline scenario 
Source: European Commission / EPC (2024) 

Source: Eurostat 

In  2021,  health  spending  was  12.1%  of  GDP 
in  Austria,  above  the  EU  average  of  10.9%. 
Austria’s  health  spending  per  capita  (adjusted  for 
differences  in  purchasing  power)  was  among  the 
highest  in  the  EU  in  2021,  well  above  the  EU 
average.  The  biggest  part  of  healthcare  spending 
(30%)  was  on  inpatient  care,  with  a  share  above 
the  EU  average.  This  is  partly  a  reflection  of  the 
high number of hospital beds in Austria compared 
to the average across the EU. Public spending as a 
proportion of total health expenditure has steadily 
increased in recent years and was 78.3% in 2021, 
however still below the EU average of 81.1%. This 
for 
points 
households when accessing healthcare, mainly for 
outpatient pharmaceuticals and outpatient medical 

cost--sharing 

to  high 

charges 

(142) Based on data provided directly by Member States to the 

European Centre for Disease Prevention and Control,  under 
the European Surveillance System. 

In  2021,  spending  on  prevention  in  Austria 
amounted  to  10.3%  of  total  spending  on 
healthcare,  the  highest  share  among  EU 
countries  and  much  higher  than  the  6.0% 
share  for  the  EU  overall.  In  addition,  Austria 
reported  a  high  proportional  increase  in  spending 
on  prevention,  with  budget  shares  more  than 
tripling  between  2019  and  2021,  surpassing  the 
106%  increase  for  the  EU  overall.  Proportionally, 
budget  shares  for  prevention  across  the  EU 
increased  most  for  emergency  response,  disease 
detection  and 
In 
Austria,  the  main  factors  explaining  the  rise  in 
spending  on  preventive  care  in  2021  are  large 
increases for early disease detection programmes 
and 
(including  for 
COVID-19).  A  further  issue  relevant  to  public 
health  is  the  consumption  of  antimicrobials  for 
systemic use. In Austria, consumption amounted to 
10.5 daily defined doses per 1 000 population per 
day  in  2022,  well  below  the  EU  average  of  19.4, 
pointing  to  a  prudent  use  of  antimicrobials  in  the 
health system. 

immunisation  programmes. 

immunisation  programmes 

The density of doctors and nurses in Austria 
is  above  the  EU  average,  but  there  are 
concerns  about 
sectoral 
disparities.  The  number  of  doctors  per  1 000 
population  has  slightly  increased  to  5.5  (2022), 

regional  and 

64 

81.781.882.081.381.381.480.981.081.380.480.180.6201720182019202020212022AustriaEU6,67,70,61,20246810EUAustria% of GDP20242070increase 
 
   
 
  
  
 
 
Table A16.1:Key health indicators 

Note: The EU average is weighted for all indicators except for doctors and nurses per 1 000 population, for which the EU simple 
average is used. Doctors’ density data refer to practising doctors in all countries except Greece, Portugal (licensed to practise) and 
Slovakia (professionally active). Nurses’ density data refer to practising nurses in all countries except Ireland, France, Portugal, 
Slovakia (professionally active) and Greece (hospital only). 
Source: Eurostat Database; except: * OECD, ** Joint Questionnaire on non-monetary healthcare statistics, *** ECDC, **** Council 
Recommendation on stepping up EU actions to combat antimicrobial resistance in a One Health approach. 

contrary  to  the  steady  increase  in  telemedicine 
uptake in the EU overall. 

investment 

Through  its  recovery  and  resilience  plan 
(RRP), Austria plans to invest EUR 254 million 
(6.4% of the RRP’s total value) in healthcare. 
The largest health investment under the RRP aims 
to  expand  multi-professional  primary  healthcare 
units  across  the  country.  This 
is 
complemented  by  a  reform  which  aims  to 
strengthen  primary  healthcare  by  promoting  the 
attractiveness  of  working  conditions  for  general 
practitioners  and  other  health  and 
social 
professions  in primary  healthcare.  In  addition, the 
RRP  contains  investments  in  community  nursing, 
the  national  roll-out  of  ‘early  aid’  for  socially 
disadvantaged  pregnant  women, 
their  young 
children  and  families,  and  the  development  of  an 
electronic child pass platform. 

above  the  EU  average  of  4.1  (2021).  However, 
there  is  a  debate  about  the  lack  of  doctors  in 
certain  specialties  and  sectors,  in  rural  areas  and 
certain  regions,  with  the  density  varying  from  4 
per  1 000 population in  Burgenland  to  nearly  7  in 
Vienna (143). Importantly, the proportion of general 
practitioners  has  declined  from  16%  in  2010  to 
less  than  14%  in  2021  and  is  now  one  of  the 
lowest  in  the  EU.  The  number  of  nurses  per 
1 000 population  was  10.6  (2021),  compared  to 
an  EU  average  of  7.9  (2021).  Regarding  the  age 
profile of nursing professionals, in 2016 around a 
quarter  of  nurses  were  aged  55  or  above.  This 
raises some concerns in terms of the sustainability 
of current nursing workforce levels. 

In  November  2023, the  Austrian  government 
presented  a  healthcare  reform  package  for 
2024-2028. The reform package aims to expand 
and  strengthen  digital  health  services, 
to 
strengthen  outpatient  care,  pursue  structural 
reforms  in  the  hospital  sector,  improve  medicine 
supply  and  vaccination  programmes,  strengthen 
nursing and long-term care, and health promotion 
and prevention (144). The reforms may help Austria 
overcome its low uptake of digital health solutions. 
For example, data for 2022 indicate a drop in the 
uptake  of  telemedicine  since  2020,  a  pattern 

(143) ÖÄK (2023), Ärztestatistik für das Jahr 2022 [Physician 

statistics for the year 2022] 
https://www.aerztekammer.at/daten-fakten. 

(144) https://eurohealthobservatory.who.int/monitors/health-

systems-monitor/analyses/hspm/austria-2018/new-health-
care-reform-2024-2028-strengthens-digital-and-
ambulatory-care 

65 

20182019202020212022EU average (latest year) Treatable mortality per 100 000 population (mortality avoidable through optimal quality healthcare)75.273.270.471.2NA93.3 (2021)Cancer mortality per 100 000 population234.0229.6230.5224.7NA235.4 (2021)Current expenditure on health, % GDP 10.410.511.412.111.410.9 (2021)Public share of health expenditure, % of current health expenditure74.775.176.878.3NA81.1 (2021)Spending on prevention, % of current health expenditure 2.12.13.410.3NA6.0 (2021)Available hospital beds per 100 000 population727719705691NA525 (2021)Doctors per 1 000 population5.25.35.35.45.54.1 (2021)*Nurses per 1 000 population6.910.310.310.6NA7.9 (2021)Total consumption of antibacterials for systemic use, daily defined dose per       1 000 inhabitants per day ***NA11.68.88.810.519.4 (2022) 
 
 
   
 
ANNEX 17: ECONOMIC AND SOCIAL PERFORMANCE AT REGIONAL LEVEL 

Annex 17 showcases the economic and social 
regional  dynamics  in  Austria.  It  provides  an 
analysis  of  economic,  social,  and 
territorial 
cohesion  in  the  Austrian  regions  and  assesses 
investment  and  subnational  reform 
emerging 
social 
needs 
development and competitiveness in the country. 

foster  economic  growth, 

to 

areas within more developed regions. At the same 
time,  some  rural  areas  with  lower  economic 
performance  are  witnessing  a  population  decline 
coupled  with  a  rising  share  of  people  aged  over 
65.   

of 
Overview 
performance at regional level 

economic 

and 

social 

Graph A17.1: Austria, NUTS2: Average GDP per 
capita growth vs GDP per capita 

Austria  has  one  of  the  lowest  regional 
disparities  among  all  EU  Member  States. 
Compared to other EU Member States and the EU 
average,  Austria  maintains  a  relatively  balanced 
overall  distribution  of  wealth,  resources,  and 
opportunities among its regions. 

Map A17.1:  Austria, NUTS2: GDP per capita growth 
2013-2022 

Source: DG REGIO calculations based on JRC (ARDECO) and 
Eurostat data 

In  2013-2022,  the  annual  real  GDP  growth 
increased  (+0.47%)  but  was  lower  than  the 
EU  average  (1.44%)  in  all  regions  (Map 
A17.1).  Annual  growth  in  GDP  per  capita  was 
negative in Vienna (-0.5%) and reached a modest 
increase of 0.3-0.9% in the other regions, with the 
exception  of  Kärnten  (1.2%).  Wien  experienced  a 
prolonged  period  (>16  years)  of  below-average 
growth 
in  GDP  per  capita,  productivity  and 
employment,  while  its  population  grew  by  more 
than  10%  (from  1.75  to  1.96  million  between 
2013 and 2022). 

In  2013-2022,  the  annual  real  GDP  growth 
per capita increased (+0.47%) but was lower 
than  the  EU  average  (1.44%)  in  all  regions 
(Map  A17.1).  The  annual  growth  was  negative  in 
Wien  (-0.5%)  and  reached  a  modest  0.3-0.9% 
increase in other regions, except for Kärnten, which 
reached 1.2%.  

Source: DG REGIO 

However, some regional disparities still exist. 
They  mainly  arise  from  differences  in  GDP  per 
capita,  labour  productivity,  and  R&D  investment 
distribution.  There  are  also  minor 
regional 
variations in terms of investment, competitiveness, 
and  innovation,  which  remain  strong  compared  to 
the EU average.   

In addition, demographic shifts could lead to 
regional  inequalities  in  the  medium  to  long 
term.  Austria  is  currently  experiencing  a  net 
population  increase  driven  by  migration.  However, 
this  population  growth  is  concentrated  in  urban 

66 

 
 
 
 
 
 
 
 
Graph A17.2: Evolution of labour productivity (real 
GVA per worker) in Austria 

are  limited  and  the  overall  performance  of 
25% exceeds the EU average of 22%. Kärnten 
and Burgenland achieved the highest ranking with 
a  27%  investment  rate.  The  Vorarlberg  region, 
with the lowest investment rate in Austria at 23%, 
slightly  trails  the  Austrian  average  but  remains 
above the EU average.  

the  Austrian 

Austria’s  innovation  performance  is  above 
the  EU  average,  with  minor  differences 
across 
In  2023, 
Ostösterreich  was  classified  as  a  ‘Leader’  while 
Westösterreich  and  Südösterreich  were  classified 
as ‘Strong Innovators’ (145). Austria lags behind the 
EU  average  in  terms  of  non-R&D  innovation 
expenditure.  

regions. 

(below  5.3% 

Low  unemployment 
in  all 
regions except Wien in 2023), coupled with a 
high  job  vacancy  rate  (4.8%  in  2022)  has 
created  labour  shortages.  The  unemployment 
rate  hit  a  low  of  -3.0-3.1%  in  Salzburg  and  Tirol 
and a high of 9.6% in the region of Wien. 

Demographic  challenges  could  significantly 
affect the labour market in the future. Austria 
has  a  net  population  growth  driven  by  migration. 
The population has grown by an annual average of 
6.7 per 1 000 residents between 2012 and 2021. 
Increases were significant in the NUTS 3 regions of 
Wien  and  Graz  (11  per  the  1  000  years). 
Conversely, Kärnten, Steiermark and Salzburg saw 
a demographic decline (-2.5 to -4.2 per 1 000 per 
year). These trends reflect the ongoing rural-urban 
transitions  across  Austria,  contributing  to  the 
urban  population's  growth  and  the  expansion  of 
conurbations. 

Strong  regional  disparities  persist  in  early 
childhood  education.  Although  the  share  of 
children  aged  0  to  3  attending  kindergarten  has 
been  on  the  rise  and  more  investments  are 
expected  with  the 
introduction  of  the  Child 
Guarantee  in  Austria,  some  regions  are  still 
offering low coverage. While in 2021/22, 45.6% of 
children  under  3  attended  kindergarten  in  Vienna, 
only  half  the  amount  went  to  kindergarten  in 
Oberösterreich (22%) and 22.9% in Steiermark. 

(145) Based on the methodology of the 2023 European Innovation 

Scoreboard.  

Source: ARDECO, DG REGIO elaboration 

in 

overall 

performance 

Significant  differences  between  Austrian 
regions  remain  in  labour  productivity.  The 
country's 
labour 
productivity, measured as gross value added (GVA) 
per  person  employed,  was  114%  of  the  EU 
average  in  purchasing  power  standards  (PPS)  in 
2022. It ranged from 139% in Vorarlberg, 124% in 
Salzburg,  120%  Wien,  to  97%  in  Burgenland. 
Labour  productivity  growth  between  2013  and 
2022  (0.1%)  was  lower  than  the  EU  average  of 
0.7%. Growth was concentrated in less performing 
regions  within  Austria,  such  as  Kärnten,  with  an 
average  growth  of  0.8%.  Labour  productivity 
decline  was highest in the more developed region 
of Wien by -0.6%.  

Austria's R&D intensity (106) ranked third in 
the  EU  in  2021.  However,  R&D  expenditure 
showed  substantial  variations  among  regions.  In 
2021,  Steiermark  ranked  top  (5.2%  of  GDP), 
followed  by  Oberösterreich  and  Wien  (more  than 
3.5%) and Burgenland ranked bottom (0.8%). R&D 
investments  have  continuously 
increased  at 
national  level,  driven  by  the  public  and  private 
sectors, with Wien excelling in knowledge-intensive 
and  high-tech  sectors.  However,  this  has  not 
translated  into  a  high  number  of  technology  and 
knowledge-intensive start-ups. This could threaten 
Austria’s future competitiveness, as the regions at 
the  bottom  of  the  competitiveness  index  are  also 
those regions with the lowest R&D expenditure. 

All  Austrian  regions  ranked  above  the  EU 
average in terms of competitiveness in 2022. 
Niederösterreich  and  Wien  (120)  ranked  top  and 
Kärnten and Burgenland ranked bottom (106). 

Disparities in investment, measured by gross 
fixed  capital  formation  as  a  share  of  GDP, 

67 

 
 
 
Table A17.1:Selected indicators at regional level in Austria 

Austria  is  also  encouraged  to  take  further 
steps  to  secure 
its  expansion  of  early 
childhood  education  (see  annex  14).  The  aim 
should be the possibility of mothers to return their 
jobs  earlier,  which  would  in  turn  lower  disparities 
between  men  and  women  in  terms  of  part-time 
employment and the pay gap. 

Austria  could  benefit  from  the  opportunities 
under  the  Strategic  Technologies  for  Europe 
Platform (STEP) initiative to boost investments 
industry 
in  critical 
transformation. 

technologies 

to  support 

Source: Eurostat, EDGAR database 

Population  ageing  poses  a  significant 
challenge  for  Austria  with  strong  societal 
impacts. Between 2012 and 2021, the population 
aged  65  and  over  experienced  an  annual  growth 
rate  of  15  per  1  000  residents.  Over  the  same 
period,  their  proportion  increased  to  19%,  which, 
although  still  among  the  lowest  in  the  EU,  is 
sizeable.  Certain  NUTS-3  regions  in  Burgenland, 
Steiermark, Kärnten, and Niederösterreich have the 
highest  percentage  of  residents  aged  over  65, 
coupled  with  GDP  per  capita  values  below  the  EU 
influence 
average.  Demographic  shifts  may 
Austria's  ability 
the 
challenges associated with an ageing population in 
the medium to long term. 

to  grow  and  address 

Investment and subnational needs ahead 

investment  priorities 

Cohesion  policy 
in 
Austria  mainly  focus  on  supporting  the 
country’s  green  and  digital  transition  and 
decoupling  economic  growth  from  natural 
resource  consumption.  The  priorities  set  out  in 
the  2021-2027  programming  period,  which  were 
adopted  in  2022,  remain  valid  under  the  current 
economic and social circumstances. 

It would be beneficial for Austria to continue 
improving  the  efficiency  of  its  research  and 
innovation  system  in  line  with  the  national 
and  regional  smart  specialisation  strategies 
and to fully exploit the potential of science-
business  links.  Further  high  priority  areas  in 
cohesion  policy 
include  promoting 
energy  efficiency  and  reducing  the  country’s 
carbon 
the 
development  and  diffusion  of  emerging  green 
technologies. In addition, it would  be  beneficial  to 
territorial 
in 
continue 
development  approaches  to  support  inclusive  and 
sustainable  local  development  in  urban  and  rural 
areas.  

in  Austria 

integrated 

investing 

including 

footprint 

through 

68 

GDP per head (purchasing power standard/PPS)GDP per head growthProductivity (GVA, PPS) per person employedReal productivity growthPopulation growthTotal population aged >65Unemployment rateR&D expenditureRegional competitivenessEU27 = 1002022Average % change on the preceding year 2013-2022EU27 = 1002022Average % change on the preceding year 2013-2022Average annual change per 1000 residents2013-2021% of total population2023% of labour force2023% of GDP2021EU27 = 1002022European Union (27 MS)1001.441000.71.921.36.12.3100Austria1240.47114.20.16.719.65.13.3113.8Burgenland880.597-0.34.123.35.20.8106.4Niederösterreich1050.71112.50.25.420.94.31.8118.9Wien142-0.49120.1-0.611.516.49.64118.9Kärtnten1101.19107.80.81.823.14.53105.9Steiermark1120.75101.50.13.821.24.35.2109.6Oberösterreich1270.9113.70.66.619.33.53.6113.6Salzburg1480.81123.90.76.219.731.8110.9Tirol1290.27113.1-0.17.3193.13.2110.1Vorarlberg1470.7138.70.48.418.23.41.9110.6Region name 
 
 
  
 
MACROECONOMIC STABILITY 
ANNEX 18: KEY FINANCIAL SECTOR DEVELOPMENTS 

funding  by 

Banks  are  the  main  financial  intermediaries 
in  Austria  and  sustainable  financing 
is 
steadily  expanding.  In  2023,  the  ratio  of  total 
assets  of  monetary  financial  institutions  to  GDP 
reached 211.6%, slightly below the EU average of 
257%  (Table  A18.1).  Austria  has  several  large 
credit  institutions,  and  the  two  largest  banking 
groups  (Erste  Group  Bank  and  Raiffeisen  Bank 
International)  have  extensive  activities  in  central, 
eastern  and  south-eastern  Europe.  Although  the 
is  predominantly  domestically 
banking  sector 
owned  (87.9%  of  total  banking  sector  assets  in 
2023),  two  large  banks  (Unicredit  Austria  and 
BAWAG)  are  majority  foreign  owned.  The  use  of 
companies  has 
capital-market 
remained  limited,  as  the  market-funding  ratio 
stood at 29.6% in 2022, below its average level in 
the  previous  5  years  and  markedly  below  the  EU 
average  of  50.8%.  Sustainable  financing  has 
expanded  steadily  in  recent  years,  and  the  share 
of outstanding green bonds in total bonds reached 
3.7% in 2023, close to the EU average of 4%. To 
support  the  development  of  the  green-bond 
the  funding  of  environmentally 
market  and 
the  Austrian  government 
friendly  projects, 
launched 
(for 
EUR 4 billion)  in  May  2022.  In  April  2023,  the 
government  raised  an  additional  EUR 2.75 billion 
from 
for 
environmental  projects.  In  addition  to  longer-term 
green  bonds,  the  Austrian  government  was  also 
the  first 
include  short-term 
instruments such as treasury bills and commercial 

its  second  green-bond 

its  first  green-bond 

issuance 

issuance 

the  EU 

to 

in 

paper in its green-debt programme. 

Austrian  banks  have  so  far  weathered  well 
the  challenges  posed  by  weaker  economic 
growth,  higher  inflation,  and  rising  interest 
rates.  The  system-wide  solvency  ratio  was  at 
19.4%  in  Q3-2023,  just  below  the  EU  average. 
While  the  capitalisation  of  Austrian  banks  has 
improved  in  recent  years,  the  largest  banks  still 
have  lower  capital  buffers  than  their  euro  area 
peers. Asset quality has slightly  deteriorated, with 
the non-performing-loan ratio declining to 1.8% in 
Q3-2023  (at  the  EU  average).  Banking  sector 
profitability  has  been  very  strong,  with  return  on 
equity  at  14.2%  in  Q3-2023  (above  the  EU 
average  of  9.9%).  In  the  first  nine  months  of 
2023,  the  Austrian  banking  sector  reported  a 
record  profit  of  more  than  EUR 11  billion,  a 
from 
substantial  part  of  which  originated 
subsidiaries  in  central,  eastern  and  south-eastern 
Europe.  Due  to  efforts  made  by  banks  to  reduce 
costs  and  rationalise  their  branch  network,  the 
cost-to-income-ratio  declined  to  46.1%  in  Q3-
2023. Banks have a comfortable liquidity position 
and liquidity-coverage ratios above the regulatory 
minima.  In  recent  years,  banks  have  benefited 
from  an  increase  in  deposits,  in  particular  retail 
deposits, and from abundant central bank liquidity. 

Despite the overall resilience of the banking 
sector,  several  vulnerabilities  require  closer 
monitoring. 
(including 
manufacturing)  are  being  affected  by  higher 
energy  prices  and  supply-chain  bottlenecks.  This 

sectors 

Some 

Table A18.1:Financial soundness indicators 

(1) Last data: Q3 2023.  
(2) Data are annualised. 
(3) Data available for EA countries only, EU average refers to euro area. 
Source: ECB, Eurostat. 

69 

2017201820192020202120222023EUMedianTotal assets of the banking sector (% of GDP)219.5217.9219.6253.0246.8227.4211.6257.0184.6Share (total assets) of the five largest banks (%)36.136.036.038.538.740.1--69.6Share (total assets) of domestic credit institutions (%)176.377.482.483.085.988.287.9-62.9NFC credit growth (year-on-year % change)6.99.37.05.08.57.92.4-2.4HH credit growth (year-on-year % change)3.03.64.34.55.93.8-1.9-1.4Financial soundness indicators:1        - non-performing loans (% of total loans)3.52.62.22.01.81.81.81.81.8- capital adequacy ratio (%)18.918.618.719.519.319.219.419.620.1- return on equity (%)28.78.67.84.16.410.014.29.913.2Cost-to-income ratio (%)165.563.863.160.859.350.346.152.844.9Loan-to-deposit ratio (%)197.898.8100.990.488.692.795.693.380.2Central bank liquidity as % of liabilities3.13.02.58.310.36.42.0-0.7Private sector debt (% of GDP)122.3122.9121.5130.6130.7121.9-133.0118.4Long-term interest rate spread versus Bund (basis points)26.628.931.528.628.856.964.9107.7104.2Market funding ratio (%)35.033.832.534.232.329.6-50.839.8Green bonds outstanding to all bonds (%)3---0.81.22.33.74.02.71-34-1011-1718-2424-27Colours indicate performance ranking among 27 EU Member States. 
 
 
 
 
 
 
   
 
in 

weakens  the  debt-servicing  capacity  of  more 
vulnerable  corporate  borrowers  and  may  impact 
the  asset  quality  of  banks 
the  future. 
Meanwhile,  indebted  households  are  also  faced 
with higher debt-service payments and the erosion 
of  their  disposable  income.  Although  the  share  of 
loans  with  variable  interest  rates  has  decreased 
steadily  in  recent  years,  roughly  50%  of  new 
mortgage  loans  to  households  are  still  granted 
with  variable  interest  rates.  The  exposure  of  the 
Austrian  banking  sector  to  Russia  (manageable 
from  a bank-capital  perspective  and  concentrated 
in  one  credit  institution)  also  warrants  close 
risks  have  started 
oversight.  More 
materialising 
real-estate 
in 
segment  (with  the  failure  of  a  large  company), 
amidst:  (i)  headwinds  to  both  borrowers’  credit 
ratings and associated property  valuations arising 
from  higher  interest  rate  levels;  and  (ii)  structural 
shifts,  such  as  the  increasing  prominence  of 
buildings’  environmental  criteria  or  changes  in 
demand due to online shopping and remote work. 

recently, 
the  commercial 

The 

volume 

Lending  growth  has  been  decelerating  since 
late 2022, amidst rising interest rates. Robust 
demand  for  home  ownership  and  corporate 
liquidity  had  driven  bank  lending  in  Austria  in 
recent  years.  However,  in  Q3-2023,  the  annual 
growth rate in mortgage loans fell to –1.7% year-
on-year  (from  6.7%  year-on-year  in  Q3-2022), 
while total lending to households declined by 1.9% 
year-on-year. 
outstanding 
consumer loans was somewhat higher than a year 
earlier. While lending to non-financial corporations 
has been driven by financing needs for inventories 
and  working  capital,  it  too  has  decelerated  in  the 
rising interest rate environment. The tightening of 
monetary policy also led to an increase in the cost 
of  lending  to  households  and  companies,  in 
particular  since  the  second  half  of  2022.  In 
particular,  the  interest  rate  for  new  mortgage 
loans increased to 4.66% in November 2023, 1.93 
percentage points higher than at the beginning of 
2022, and the highest level since 2009.  

of 

The  housing  market  in  Austria  has  been 
cooling  since  the  middle  of  2022,  while 
demand  for  mortgage  loans  is  fading.  Over 
the  past  10  years,  residential  real-estate  prices 
doubled in Austria, which reduced the affordability 
of  housing.  Housing  price  increases  had  been 
particularly  strong  in  the  period  from  early  2020 
to  Q3-2022.  Their  recent  decline  coincides  with 
slowing  demand  from  households  for  mortgage 
loans,  amid  higher  bank  lending  rates  and  an 

70 

Risk 

Board’s 

the  Austrian 

the 
uncertain  economic  situation.  Following 
2021 
Systemic 
European 
recommendation  on 
real-estate 
sector,  the  Austrian  Financial  Market  Authority 
introduced  binding  borrower-based  measures  to 
mitigate  the  risks  associated  with  real-estate 
vulnerabilities. The adopted measures, applying to 
new  mortgage  loans  from  August 2022,  included 
upper  limits  for  loan-to-value  ratios  (90%),  debt-
loan 
service-to-income 
maturities 
In  April  2023,  these 
measures  were  relaxed  by  excluding  bridge  loans 
and  by  increasing  the  minimum  threshold  for 
couples, 
for  greater  operational 
flexibility.  Private-sector  debt  as  a  percentage  of 
GDP declined to 121.9% at the end of 2022, down 
from 130.7% in 2021. 

(35  years). 

to  provide 

(40%), 

ratios 

and 

Graph A18.1: Housing prices and mortgage lending 

(1) The data on housing prices are expressed as a quarterly 
index (2015=100). 
Source: Eurostat. 

The  Austrian  insurance  sector  has  remained 
resilient.  The  Austrian  insurance  market  has 
composite 
traditionally  been  dominated  by 
insurance  undertakings  which,  in  addition  to  life 
insurance,  also  pursue  activities  in  at  least  one 
other  balance  sheet  group.  Like  the 
largest 
insurance 
banking  groups,  the  main  Austrian 
undertakings  have  a  significant 
international 
footprint.  For  several  years,  the  low-interest-rate 
environment  had  put  strains  on  the  traditional 
business  of  life-insurance  undertakings,  but  the 
increase  in  interest  rates  since  July  2022  has 
mitigated 
risks.  The  solvency  capital 
requirements improved until mid-2023 when  they 
still stood above the EU average. On investments, 
insurance  undertakings  continued  to  focus  on 
interest-bearing 
equity 
securities, 
investments have remained low. 

these 

while 

-3-2-1012345678020406080100120140160180200201520182021House price index (lhs)Adjusted loans, lending for house purchase (rhs)yoy% change2015=100 
  
ANNEX 19: TAXATION 

This  annex  provides  an 
indicator-based 
overview  of  Austria’s  tax  system.  It  includes 
information on the tax structure (the types of tax 
that Austria derives most of its revenue from), the 
tax  burden  on  workers,  and  the  progressivity  and 
the redistributive effect of the tax system. It also 
provides 
tax  collection  and 
compliance. 

information  on 

Austria’s tax revenues are high in relation to 
GDP,  with  the  highest  contribution  coming 
from  labour  taxation  while  growth-friendly 
tax  bases  appear  to  be  underused.  Despite  a 
series  of  tax  reforms  (in  2005,  2010,  2015  and 
two  in  2022),  Austria  remains  a  high-tax  country 
with a tax-to-GDP ratio above the EU average. As 
indicated in Table A19.1, labour tax revenues as a 
percentage of GDP were among the highest in the 
EU  in  2022.  Revenues  from  consumption  taxes 
and  environmental  taxes  as  a  percentage  of  GDP 
were  very  close  to  the  EU  aggregate.  Revenues 
from capital taxes and property taxes were below 
the EU aggregate. Recurrent taxes on property as a 
percentage  of  GDP  in  Austria  were  among  the 
lowest  in  the  EU,  in  part  because  the  cadastral 
values  serving  as  their  tax  base  are  largely 
outdated.  Moreover,  Austria  has  no  inheritance, 
taxes.  Pollution  and 
estate,  wealth  or  gift 
resources 
for  1%  of 
environmental taxes, so there could be potential to 
strengthen  the  application  of  the  ‘polluter  pays’ 
principle. Austria has only implemented two of the 

taxes  only  account 

Table A19.1:Taxation indicators 

landfilling  and 

six  main  types  of  pollution  and  resources  taxes 
incineration  and 
(i.e. taxes  on 
discharges  of  waste  into  water.  It  does  not  have 
taxes  on  NOx  emissions,  pesticides,  plastic 
products  and 
fertilisers.  Austria  previously 
implemented a tax on fertilisers, but this was later 
abolished. 

Austria’s  tax-benefit  system  helps  reduce 
income inequality, but the labour tax burden 
is  relatively  high  at  various  wage  levels.  In 
2023,  the  labour  tax  wedge  was  substantially 
higher  than  the  EU  average  at  various  income 
levels, i.e. for single persons at the average wage 
(100%) as well as at 50%, 67% and 167% of the 
average  wage  (see  Graph  A19.2).  Second  earners 
at  a  wage  level  of  67%  of  the  average  wage, 
whose spouses earn the average wage, are subject 
to a tax wedge that is higher than the EU average, 
although they are taxed only slightly more heavily 
than  single  persons  at  the  same  wage  level. 
Overall, 
system  effectively 
addresses  income  inequality.  In  2022,  the  tax 
benefit  system  helped  reduce  income  inequality 
(as  measured  by  the  GINI  coefficient)  by  more 
than the EU average. 

tax-benefit 

the 

(1) Forward-looking effective tax rate (OECD). 
(2) A higher value indicates a stronger redistributive impact of taxation. 
(*) EU-27 simple average. 
(**) Forecast value for 2022, if available. For more details on the VAT gap, see European Commission, Directorate-General for 
Taxation and Customs Union, 2023, VAT gap in the EU, https://data.europa.eu/doi/10.2778/911698. 
For more data on tax revenues as well as the methodology applied, see the Data on Taxation webpage, 
https://ec.europa.eu/taxation_customs/taxation-1/economic-analysis-taxation/data-taxation_en. 
Source: European Commission and OECD 

71 

AT2010202020212022202320102020202120222023Total taxes (including compulsory actual social contributions) (% of GDP)41.142.243.443.237.940.040.440.2Labour taxes (as % of GDP)23.124.224.223.120.021.320.720.3Consumption taxes (as % of GDP)11.611.011.211.310.810.711.211.0Capital taxes (as % of GDP)6.46.98.08.87.18.08.68.9Of which, on income of corporations (as % of GDP)2.02.22.83.52.42.53.03.4Total property taxes (as % of GDP)0.70.90.90.81.92.32.22.1Recurrent taxes on immovable property (as % of GDP)0.20.20.20.21.11.21.11.0Environmental taxes as % of GDP2.32.12.21.92.42.22.32.0Tax wedge at 50% of average wage (Single person) (*)38.436.837.234.237.033.931.732.131.831.7Tax wedge at 100% of average wage (Single person) (*)48.247.547.846.947.241.040.139.940.040.2Corporate income tax - effective average tax rates (1) (*)23.923.923.919.519.019.0Difference in Gini coefficient before and after taxes and cash social transfers (pensions excluded from social transfers) (2) (*)10.39.710.19.58.68.18.27.9Outstanding tax arrears: total year-end tax debt (including debt considered not collectable) / total revenue (in %) (*)10.38.640.935.5VAT Gap (% of VAT total tax liability, VTTL)(**)9.96.62.89.75.4AustriaEU-27Tax structureProgressivity & fairnessTax administration & compliance 
 
 
 
 
 
 
        
 
Graph A19.1: Tax revenues from different tax types, % of total revenue 

Note: Values for EU are GDP-weighted EU averages (EU aggregates) 
Source: European Commission 

Graph A19.2: Tax wedge for single and second 
earners as a % of total labour costs, 2023 

The second earner tax wedge assumes a first earner at 100% 
of the average wage and no children. For the methodology of 
the tax wedge for second earners, see OECD, 2016, Taxing 
Wages 2014-2015. 
Source: European Commission 

Tax  administration  and  tax  compliance. 
Austria  performs  relatively  well  on  tax 
compliance and tax  administration, including 
on  digitalisation.  Austria  is  doing  moderately 
well in digitalising its tax administration, which can 
help  reduce  tax  arrears  and  compliance  costs. 
Outstanding  tax  arrears  were  8.6%  of  total 
revenue  in  2021,  so  below  the  EU  average.  The 
VAT  gap  (the  gap  between  revenues  actually 
liability) 
collected  and 
tax 
decreased 
in  2021,  which  was 
significantly  lower  than  the  EU-wide  VAT  gap  of 
5.3%.  Regarding 
the  digitalisation  of  public 
administration,  digitalisation  funds  have  been 
introduced  in  order  to  accelerate  digitalisation  in 
federal  administration  by  funding  projects  with 
cross-departmental  effects. 
In  2023,  Austria 
replaced  the  mobile  phone  signature  with  an  ID 

theoretical 

to  2.8% 

the 

Austria account. This is a modern and secure way 
of  identifying  oneself  digitally,  so  that  one  can 
prove  one’s  identity  online  and  access  digital 
services,  such  as  FinanzOnline.  In  the  future, 
companies  will  be  able  to  use  ID  Austria  in  a 
variety of different ways. 

Austria  has  introduced  several  reforms  to 
the  tax  system.  Austria  reduced  labour  taxation 
by  indexing  personal  income  tax  brackets  to  two 
thirds of inflation as from 2023  (146). Furthermore, 
as  part  of the eco-social  tax  reform  of  2022  and 
of  its  Recovery  and  Resilience  Plan  (RRP),  Austria 
introduced  a  price  path  for  CO2  emissions  in 
sectors  not  currently  covered  by  the  European 
Emissions  Trading  System.  In  addition,  as  part  of 
its RRP, Austria reduced its lowest personal income 
tax (PIT) rate from 25% to 20% and extended the 
application  of the top  PIT rate of 55% until  2025 
for incomes above EUR 1 million. Further reducing 
the labour tax burden beyond a simple adjustment 
for  inflation  (especially  for  low-income  earners) 
and  making  greater  use  of  growth-friendly  taxes 
(e.g.  recurrent  property  taxes  and  inheritance  and 
gift taxes) could boost economic growth and make 
the tax system fairer. 

(146) The remaining third has to be used for further discretionary 

relief measures to be adopted by the ministerial council each 
year. 

72 

37.042.747.249.943.1202530354045505550100150Tax wedge, % of total labour costsEarnings as % of the average wageSingle earner - ATSingle earner - EU averageSecond earner -  ATSecond earner -  EU average50.627.322.153.526.120.5Tax revenue shares in 2022, Austria (outer ring) and EU (inner ring)Taxes on labourTaxes on consumptionTaxes on capital2.53.91.80.90.00.20.42.51.52.70123456Austria -environmentaltaxationEU -environmentaltaxationAustria -propertytaxationEU - propertytaxationEnvironmental and property taxation as % of total tax revenue, Austria and the EUEnergy taxesTransport taxesResource/pollution taxesRecurrent property taxesOther property taxes 
       
 
 
       
ANNEX 20: TABLE WITH ECONOMIC AND FINANCIAL INDICATORS 

Table A20.1:Key economic and financial indicators 

(1) domestic banking groups and stand-alone banks, EU and non-EU foreign-controlled subsidiaries and EU and non-EU foreign-
controlled branches. 
(2) NIIP excluding direct investment and portfolio equity shares. 
Source: Eurostat and ECB as of 2024-5-17, where available; European Commission for forecast figures (Spring forecast 2024). 

73 

2004-072008-122013-2020212022202320242025Real GDP (y-o-y)3.00.60.44.24.8-0.80.31.6Potential growth (y-o-y).1.01.11.01.11.00.80.8Private consumption (y-o-y)1.90.9-0.44.25.7-0.31.32.0Public consumption (y-o-y)2.11.20.97.50.0-0.40.10.5Gross fixed capital formation (y-o-y)1.7-0.21.96.10.1-2.4-2.22.3Exports of goods and services (y-o-y)7.61.21.69.111.2-0.21.22.4Imports of goods and services (y-o-y) 6.21.31.814.37.9-1.81.02.7Contribution to GDP growth:Domestic demand (y-o-y)1.90.70.45.22.9-0.80.11.7Inventories (y-o-y)0.4-0.10.01.3-0.2-0.90.00.0Net exports (y-o-y)0.90.00.0-2.21.91.00.1-0.1Contribution to potential GDP growth:Total Labour (hours) (y-o-y).0.00.30.20.30.50.40.3Capital accumulation (y-o-y).0.50.50.60.50.40.40.4Total factor productivity (y-o-y).0.50.20.20.20.10.10.2Output gap0.2-0.4-0.6-2.21.4-0.5-1.0-0.3Unemployment rate5.75.15.86.24.85.15.35.1GDP deflator (y-o-y)2.11.71.92.15.37.64.12.6Harmonised index of consumer prices (HICP, y-o-y)2.02.31.52.88.67.73.62.8HICP excluding energy and unprocessed food (y-o-y)1.62.01.82.15.77.84.22.9Nominal compensation per employee (y-o-y)2.52.22.22.94.77.77.13.2Labour productivity (real, hours worked, y-o-y)2.40.60.8-0.52.3-1.7-0.30.3Unit labour costs (ULC, whole economy, y-o-y)0.92.52.60.72.69.77.22.3Real unit labour costs (y-o-y)-1.20.80.6-1.4-2.61.92.9-0.3Real effective exchange rate (ULC, y-o-y)-0.40.40.80.5-1.32.12.2-0.3Real effective exchange rate (HICP, y-o-y)0.1-0.40.60.3-1.52.3..Net savings rate of households (net saving as percentage of net disposable income)11.210.08.311.29.2...Private credit flow, consolidated (% of GDP)5.92.23.47.65.0...Private sector debt, consolidated (% of GDP)124.1129.7124.2130.7121.9...of which household debt, consolidated (% of GDP)50.953.150.852.248.7...of which non-financial corporate debt, consolidated (% of GDP)73.276.673.478.473.2...Gross non-performing debt (% of total debt instruments and total loans and advances) (1).3.43.51.61.5...Corporations, net lending (+) or net borrowing (-) (% of GDP)0.01.91.14.21.00.90.81.4Corporations, gross operating surplus (% of GDP)26.925.324.425.625.123.221.621.2Households, net lending (+) or net borrowing (-) (% of GDP)5.24.02.83.52.53.23.92.7Deflated house price index (y-o-y)0.72.74.19.13.9-9.9..Residential investment (% of GDP)4.44.34.55.45.65.1..Current account balance (% of GDP), balance of payments2.92.62.11.6-0.32.72.82.6Trade balance (% of GDP), balance of payments3.83.23.30.70.33.6..Terms of trade of goods and services (y-o-y)-0.7-0.70.3-0.6-3.82.50.70.2Capital account balance (% of GDP)-0.1-0.1-0.20.00.10.1..Net international investment position (% of GDP)-12.8-5.16.715.617.616.6..NENDI - NIIP excluding non-defaultable instruments (% of GDP) (2)-9.8-11.3-6.7-2.6-1.5-2.3..IIP liabilities excluding non-defaultable instruments (% of GDP) (2)175.9193.7157.2155.6145.9146.6..Export performance vs. advanced countries (% change over 5 years)..-2.60.2-1.5-0.4..Export market share, goods and services (y-o-y)-0.5-4.80.4-4.4-2.3-1.2-2.2-1.2Net FDI flows (% of GDP)1.42.80.82.3-0.41.1..General government balance (% of GDP)-2.8-3.2-1.9-5.8-3.3-2.7-3.1-2.9Structural budget balance (% of GDP)..-1.3-4.5-4.1-2.4-2.5-2.7General government gross debt (% of GDP)66.579.179.782.578.477.877.777.8forecast 
 
 
 
  
 
 
ANNEX 21: DEBT SUSTAINABILITY ANALYSIS 

This  annex  assesses  fiscal  sustainability 
risks for Austria over the short, medium and 
long  term. 
It  follows  the  multi-dimensional 
approach  of  the  European  Commission’s  2023 
Debt Sustainability Monitor, updated based on the 
Commission 2024 spring forecast. 

1  –  Short-term  risks  to  fiscal  sustainability 
low.  The  Commission’s  early-detection 
are 
indicator  (S0)  does  not  point  to  any  major  short-
term  fiscal  risks  (Table A21.2) (147).  Government 
gross  financing  needs  are  expected  to  decrease 
slightly  to  around  16%  of  GDP  on  average  over 
2024-2025 
Financial 
markets’ perceptions of sovereign risk are positive, 
as confirmed by the ratings of the main agencies.  

(Table A21.1, Table 1). 

2  –  Medium-term  fiscal  sustainability  risks 
appear high.   

The DSA baseline shows that the government 
debt  ratio 
increase  to 
is  expected  to 
relatively  high  levels  in  the  medium  term 
(reaching  around  90%  of  GDP  in  2034) 
(Graph 1, Table 1) (148). The debt increase is due to 
the  assumed  structural  primary  deficit  (excluding 
changes  in  cost  of  ageing)  of  1.1%  of  GDP  as  of 
2024.  Compared  to  historical  data,  this  appears 
plausible as 95% of past fiscal positions were less 
stringent  than  the  one  assumed  in  the  baseline 
(Table  A21.2) (149).  On  the  other  hand,  the  debt 

(147) The S0 is a composite indicator of short-term risk of fiscal 
stress. It is based on a wide range of fiscal and financial-
competitiveness indicators that have proven to be a good 
predictor of emerging fiscal stress in the past.  

(148) The assumptions underlying the Commission’s ‘no-fiscal 

policy change’ baseline include in particular: (i) a structural 
primary surplus, before changes in ageing costs, of 1.1% of 
GDP from 2024 onwards; (ii) inflation converging linearly 
towards the 10-year forward inflation-linked swap rate 10 
years ahead (which refers to the 10-year inflation 
expectations 10 years ahead); (iii) the nominal short- and 
long-term interest rates on new and rolled over debt 
converging linearly from current values to market-based 
forward nominal rates by T+10; (iv) real GDP growth rates 
from the Commission 2024 spring forecast, followed by the 
EPC/OGWG ‘T+10 methodology projections between T+3 and 
T+10 (average of 1.0%); (v) ageing costs in line with the 
2024 Ageing Report (European Commission, Institutional 
Paper 279, April 2024). For information on the methodology, 
see the 2023 Debt Sustainability Monitor (European 
Commission, Institutional Paper 271, March 2024). 

(149) This assessment is based on the consolidation space 

indicator, which measures the frequency with which a tighter 
fiscal position than assumed in a given scenario has been 
observed in the past. Technically, this consists of looking at 
the percentile rank of the projected SPB within the 

dynamics  benefit  from  a  still  favourable  but 
declining  snowball  effect  of  around  -0.9  pp.  of 
GDP annually on average over 2025-2034.  

four 

interest-growth 

The  baseline  projections  are  stress-tested 
deterministic 
alternative 
against 
scenarios to assess the impact of changes in 
key  assumptions  relative  to  the  baseline 
(Graph 1).  Under  the  historical  structural  primary 
balance  (SPB)  scenario  (i.e.  the  SPB  returns  to  its 
historical  15-year  average  of  a  balanced  budget) 
the  debt  ratio  would  be  lower  than  under  the 
baseline  by  about  8 pps. in  2034.  However, under 
the  adverse 
rate  differential 
scenario  (i.e.  the  interest-growth  rate  differential 
deteriorates by 1 pp. compared with the baseline), 
the  debt  ratio  would  be  higher  than  under  the 
baseline  by  around  7 pps.  in  2034.  Under  the 
financial  stress  scenario 
rates 
temporarily  increase  by  1 pp.  compared  with  the 
baseline)  the  government  debt  ratio  would  be 
higher by around 1 pp. in 2034. Finally, under the 
lower  structural  primary  balance  scenario  (i.e.  the 
projected cumulative improvement in the SPB over 
2023-2024  is  halved),  the  debt  ratio  would  be 
almost  unchanged  compared  with  the  baseline  in 
2034. 

interest 

(i.e. 

These 

stochastic 

The  stochastic  projections  indicate  medium 
risk,  pointing  to  the  moderate  sensitivity  of 
these  projections  to  plausible  unforeseen 
events  (150). 
simulations 
indicate a 60% probability that the debt ratio will 
be higher in 2028 than in 2023, implying medium 
risks  given  the  high  debt  level.  In  addition,  the 
the  baseline  debt 
uncertainty 
projections 
the  difference 
between  the  10th  and  90th  debt  distribution 
percentiles)  is  medium  (reaching  around  30%  of 
GDP in five years’ time) (Graph 2).  

surrounding 
(as  measured  by 

3  –  Long-term  fiscal  sustainability  risks 
appear  overall  medium.  This  assessment  is 
based  on  the  combination  of  two  fiscal  gap 
indicators,  capturing  the  required  fiscal  effort  to 
stabilise  debt  (S2  indicator)  and  to  bring  debt  to 

distribution of SPBs observed in the past in the country, 
taking into account all available data from 1980 to 2022. 

(150) The stochastic projections show the joint impact on debt of 

10,000 different shocks affecting the government’s 
budgetary position, economic growth, interest rates and 
exchange rates. This covers 80% of all the simulated debt 
paths and therefore excludes tail events. 

74 

 
 
 
 
 
 
 
by  3  pps.  in  2025  to  reduce  its  debt  to  60%  of 
GDP  by  2070.  This  result  is  mainly  driven  by  the 
projected  increase  in  age-related  public  spending 
(1.6  pps.)  and  the  unfavourable  initial  budgetary 
position  (contribution  of  1.0 pp.).  In  addition,  the 
current  distance  of  the  government  debt  ratio 
from the 60% reference value further reduces the 
fiscal 
(0.4 pp.) 
for 
(Table A21.1, Table 2).  

manoeuvre 

room 

4  –  Finally,  several  additional  risk  factors 
need to be considered in the assessment.  On 
the one hand, risk-increasing factors are related to 
the  recent  increase  in  interest  rates  and  the  fact 
that  around  60%  of  the  debt  is  held  by  non-
residents.  In  addition,  some  contingent  liability 
risks  stem  from  the  private  sector,  including  via 
the  possible  materialisation  of  state  guarantees. 
While  the  capitalisation  of  Austrian  banks  has 
improved  in  recent  years,  the  largest  banks  still 
have  lower  capital  buffers  than  their  euro  area 
peers.  On  the  other  hand,  risk-mitigating  factors 
include the lengthening of debt maturity in recent 
years and the large share of debt denominated in 
euro.  

(S1 

indicator)  over  the 

60%  of  GDP 
long 
term (151) (152).  This  assessment  is  driven  by  the 
unfavourable  initial  budgetary  position  and  the 
projected  increase  in  ageing  costs.  Hence,  these 
results are conditional on the country maintaining 
a  sizeable  SPB  over  the  long  term,  and  duly 
implementing legislated pension reforms. 

The  S2  indicator  points  to  medium  fiscal 
sustainability  risks.  The  indicator  shows  that, 
relative  to  the  baseline,  the  SPB  would  need  to 
improve by 3.8 pps. of GDP in 2025 to ensure debt 
stabilisation  over  the  long  term.  This  result  is 
underpinned  by  the  projected  increase  in  ageing-
related  costs  (contribution  of  2.2 pps.)  and  an 
unfavourable  initial  budgetary  position  (1.5 pps.). 
Ageing costs’ developments are primarily driven by 
a  projected  increase  in  long-term  care  (1.3 pps.) 
and  health  care  spending  (1.3  pps.)  (Table A21.1, 
Table 2). While several investments and reforms in 
the  RRP  contribute to  supporting the  efficiency  of 
the  Austrian  health  and  long-term  care  systems, 
additional  measures  may  be  required  to  further 
improve its fiscal sustainability. 

The  S1  indicator  points  to  medium  fiscal 
sustainability risks. The indicator shows that the 
country  would  need  to  improve  its  fiscal  position 

(151)The S2 fiscal sustainability indicator measures the 

permanent SPB adjustment in 2025 that would be required 
to stabilise public debt over an infinite horizon. It is 
complemented by the S1 indicator, which measures the 
permanent SPB adjustment in 2025 to bring the debt ratio to 
60% by 2070. The impact of the drivers of S1 and S2 may 
differ due to the infinite horizon component considered in the 
S2 indicator. For both the S1 and S2 indicators, the risk 
assessment depends on the amount of fiscal consolidation 
needed: ‘high risk’ if the required effort exceeds 6 % of GDP, 
‘medium risk’ if it is between 2% and 6% of GDP, and ‘low 
risk’ if the effort is negative or below 2% of GDP. The overall 
long-term risk classification combines the risk categories 
derived from S1 and S2. S1 may notch up the risk category 
derived from S2 if it signals a higher risk than S2. See the 
2023 Debt Sustainability Monitor for further details. 

(152)The S2 fiscal sustainability indicator measures the 

permanent SPB adjustment in 2025 that would be required 
to stabilise public debt in the long term. It is complemented 
by the S1 indicator, which measures the permanent SPB 
adjustment in 2025 to bring the debt ratio to 60% by 2070. 
For both the S1 and S2 indicators, the risk assessment 
depends on the amount of fiscal consolidation needed: ‘high 
risk’ if the required effort exceeds 6 % of GDP, ‘medium risk’ 
if it is between 2% and 6% of GDP, and ‘low risk’ if the effort 
is negative or below 2% of GDP. The overall long-term risk 
classification combines the risk categories derived from S1 
and S2. S1 may notch up the risk category derived from S2 if 
it signals a higher risk than S2. See the 2023 Debt 
Sustainability Monitor for further details. 

75 

 
 
Table A21.1: Debt sustainability analysis - Austria 

Source: Commission services. 

Table A21.2: Heat map of fiscal sustainability risks - Austria 

Source: Commission services. 

76 

Table 1. Baseline debt projections20212022202320242025202620272028202920302031203220332034Gross debt ratio (% of GDP)82.578.477.877.778.178.679.380.381.582.884.486.288.089.9Changes in the ratio-0.5-4.1-0.6-0.10.40.50.71.01.21.41.61.81.81.9of whichPrimary deficit4.72.31.51.71.61.81.91.92.02.12.22.32.42.4Snowball effect-3.9-6.8-3.8-1.9-1.6-1.2-1.1-1.0-0.8-0.8-0.6-0.5-0.5-0.6Stock-flow adjustments-1.20.41.60.20.40.00.00.00.00.00.00.00.00.0Gross financing needs (% of GDP)16.416.417.315.515.715.715.916.216.516.917.317.718.118.6S1S2Overall index  (pps. of GDP)3.03.8of which Initial budgetary position1.01.5Debt requirement0.4Ageing costs1.62.2of which    Pensions0.30.1     Health care0.81.1     Long-term care0.81.3Education-0.3-0.3Table 2. Breakdown of the S1 and S2 sustainability gap indicators3040506070809010011020212022202320242025202620272028202920302031203220332034Graph 1. Deterministic debt projections Historical SPB scenarioLower SPB scenarioFinancial stress scenarioAdverse 'r-g' scenarioBaseline% of GDPp10p20p40p60p80p903040506070809010020212022202320242025202620272028% of GDPGraph 2. Stochastic debt projections 2024-2028MedianBaselineBaselineHistorical SPBLower SPBAdverse 'r-g'Financial stressOverallMEDIUMMEDIUMHIGHHIGHHIGHMEDIUMDebt level (2034), % GDP89.981.790.397.090.6Debt peak year20342034203420342034Fiscal consolidation space95%93%95%95%95%Probability of debt ratio exceeding in 2028 its 2023 level60%Difference between 90th and 10th percentiles (pps. GDP)30.0Source: European Commission (for further details on the Commission's multidimensional approach, see the 2023 Debt Sustainability Monitor)Short termMedium term - Debt sustainability analysis (DSA)Long termOverall                               (S0)Overall Deterministic scenariosStochastic projectionsS2S1Overall(S1 + S2)(1)Debtlevelin2034.Green:below60%ofGDP.Yellow:between60%and90%.Red:above90%.(2)Thedebtpeakyearindicateswhetherdebtisprojectedtoincreaseoveralloverthenextdecade.Green:debtpeaksearly.Yellow:peaktowardsthemiddleoftheprojectionperiod.Red:latepeak.(3)Fiscalconsolidationspacemeasurestheshareofpastfiscalpositionsinthecountrythatweremorestringentthantheoneassumedinthebaseline.Green:highvalue,i.e.theassumedfiscalpositionisplausiblebyhistoricalstandardsandleavesroomforcorrectivemeasuresifneeded.Yellow:intermediate.Red:low.(4)Probabilityofdebtratioexceedingin2028its2023level.Green:lowprobability.Yellow:intermediate.Red:high(alsoreflectingtheinitialdebtlevel).(5)thedifferencebetweenthe90thand10thpercentilesmeasuresuncertainty,basedonthedebtdistributionunder10000differentshocks.Green,yellowandredcellsindicateincreasinguncertainty.(Forfurtherdetailson the Commission's multidimensional approach, see the 2023 Debt Sustainability Monitor)LOWHIGHMEDIUMMEDIUMMEDIUM