This Survey is published on the responsibility of the Economic and Development Review Committee of the OECD, which is charged with the examination of the economic situation of member countries. The economic situation and policies of Austria were reviewed by the Committee on 15 November 2021. The draft report was then revised in the light of the discussions and given final approval as the agreed report of the whole Committee on 03 December 2021. The Secretariat’s draft report was prepared for the Committee by Rauf Gönenç (Senior Economist) and Dennis Dlugosch (Economist), under the supervision of Isabelle Joumard (Head of Division). The Survey also benefitted from contributions by the staff of the Federal Ministry of Finance in Vienna and Michael Abendschein from the OECD. Statistical research assistance was provided by Eun Jung Kim and editorial assistance by Heloise Wickramanayake. The previous Survey of Austria was issued in November 2019. Information about the latest as well as previous Surveys and more information about how Surveys are prepared is available at www.oecd.org/eco/surveys.

Austria has faced the successive waves of the pandemic with varying degrees of intensity.The human toll has been significant, despite the large health care resources. The vaccination campaign reached 66% of the total population by mid-November 2021. Shortcomings in health literacy may have slowed down the vaccination campaign, confirming the importance of the 2015 Health Literacy Strategy. The restrictions on mobility have generally led to significant drops in economic activity, before a strong recovery through summer 2021 (). This reflected, particularly in certain periods of the year, the large share of tourism in economic activity, which has also led to regional differences in the impacts of the pandemic.

The Austrian economy has long performed well, with one of the highest GDP per capita in the OECD, a high productivity level, low-income inequality and low unemployment. In the years preceding the COVID-19 shock, the country suffered a relative decline in performance, with a slowdown of productivity growth, signs of skill mismatch despite a strong vocational training system, and environmental sustainability falling behind the best performers in the OECD, notably in reducing greenhouse gas emissions.

The economic shock induced by the COVID-19 pandemic is accelerating structural changes and is posing new challenges. Austria faces wider growth opportunities and new adjustment challenges related notably to two major structural transformations: transition to carbonless growth and the generalisation of more advanced forms of digitalisation. These imply new entries and exits in the business sector, more capital and labour re-allocations and greater geographic mobility of labour. A better activation of the existing talent pool, in particular female, elderly and migrant workers is also needed to address the ageing of the society. In this context public policies should aim at further stimulating business dynamism by facilitating market entries; supporting firms’ capacity to invest by helping strengthen their balance sheets;  better adapting skills to jobs for all categories of workers; and providing the right incentives to R&D to boost long-term innovation.