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General information about Austria


about Austria

Geography, population and political background

Austria covers an area of around 84.000 square kilometres with a population of around 9 million inhabitants (as of January 2019), including around 1,4 million foreign citizens (16,2% of the total population). In 2018, around 2 million people were living in Austria who have a migratory background (meaning they themselves or at least their direct family members come from another country), that is 23,3% and therefore almost one quarter of the entire population. Austria’s geographic position is in the very heart of Europe, just a few flight hours away from wherever you want to go in Europe. Vienna is seen as the main gateway to Central and Eastern Europe which is still seen as the main area for growth on the continent. Vienna airport has the most connections to destinations in CEE, greater than Frankfurt and London Heathrow. The transportation links via highways, railways as well as the river Danube are substantial. The capital Vienna is, as expected, the most densely populated province with around 4.600 residents per square kilometre while Carinthia is the least densely populated province with 59 inhabitants per square kilometre. The average life expectancy is 83,9 years for women and 79,3 years for men. Austria has borders with the following European countries: Germany, Czech Republic, Slovakia, Hungary, Slovenia, Italy, Switzerland and Liechtenstein. Politically Austria may be described as a parliamentary-democratic republic, a federal state comprised of nine provinces, each province has its own capital and local government. The legislative bodies are the National Council (elected every 5 years) and the country parliaments (elected every 5-6 years), both elected by the people, as well as the Federal Council, which represents the provincial interests in the federal parliament, elected from the country parliaments. The legislative tasks are split into federal tasks of the Austrian government in Vienna and regional tasks which are delegated to the responsibility of the respective provinces.
  Currently there are five parties elected for the National Council: the Austrian People’s Party (ÖVP) with the current Chancelor Mr. Sebastian Kurz and the Green Party (Die Grünen) are forming the current government. For a stable government a requirement of 50% or more of the seats in the national council is the most reasonable for the resolution of the conventional federal law. While the Chancelor is the Head of the government (comparable to a “(national) CEO”), the President (currently Mr. Alexander van der Bellen), who is also elected by the people (every 6 years), has rather supervisory and usually non-partisan functions (comparable to a “(national) chairman of the supervisory board”). However, in times of crisis the functionality and power of the President can be significantly strengthened, in particular the President is also Chief Commander of the Austrian Army. Further parties elected for the National Council are the Social Democratic Party of Austria (SPÖ), the Austrian Freedom Party (FPÖ) and the NEOS. These three Parties are forming the so called opposition in parliament. Currently the resolution of constitutional law is only possible in cooperation with the opposition, as this requires a majority of 2/3 in the National Council (which is currently not reached by the government itself).  Apart from the legislative bodies in Austria there is also a European Parliament of the European Union. Every member state is sending delegates to the European Parliament according to separate European Party elections – again elected directly by the people. The main bodies of public jurisdiction are the Constitutional Court and the Administrative Court. While the Constitutional Court is the guardian of the Austrian Constitution, also controlling parliament in this respect, the Administrative Court deals with disputes in connection with decisions taken by the administrative authorities. The highest court of appeal for civil and criminal proceedings is the Austrian Supreme Court. Judges in all of these courts have to be strictly independent of all influence in their duties, especially political influence. Furthermore judiciary bodies are strictly separated from executive bodies at all levels.
Fundamental human rights in Austria

The fundamental human rights in Austria are already defined in the Austrian Constitution:

“All citizens are equal before the law. No one may be discriminated against or favoured on the basis of birth, sex, origin, class or religion.”

On top of that Austria also ratified the Convention for the Protection of Human Rights and fundamental freedoms of the Council of Europe


The only official language which is spoken nationwide in Austria is German. However, there are further official languages recognized for regional autonomous population groups: e.g. Croatian, Slovenian and Hungarian. English is taught as the main first foreign language in nearly all Austrian schools.

The most important religious group is the Catholic Christian group, but the share of this group has been constantly decreasing in recent years, down to 56% in 2019. However, it still represents by far the most important religious group. This is followed by further Christian groups (the orthodox and evangelical Christians). An increasing religious group is Islam, which has been growing in the last 40 years. The rest of the religious groups are – considering the number of its members – negligible. Apart from the growing number of people without affiliation.

Although the Austrian culture is without doubt, influenced by its catholic traditions, the Austrian legislation and also the understanding of the Austrian population is clearly secular. Religion must not be mixed up with political attitudes.

Representatives of religious groups are therefore very cautious about expressing political opinions in Austria. According to the Austrian constitution every citizen has had the right of religious freedom for more than 100 years. Social and religious tolerance is of the highest priority in the Austrian society.

Today around 20% of the entire population in Austria has a migration background (in Vienna 40%) – meaning the person or at least their parents were not born in Austria. Consequently these people usually have foreign language skills, usually languages from the eastern parts of Europe, which highlights the potential influence of Austria for the business relationships to East- and South East Europe.

Due to the historical importance of Vienna, and more generally Austria, the demographics of the country are diverse. Vienna has a multi-cultural population which greatly benefits the city in all areas such as culture and cuisine. These communities of nationalities form strong bonds and maintain a strong link to their home countries through associations, cultural institutes and magazines.


Austria has a typical central European climate, i.e. warm summers, cold winters with moderate rainfall and snow.

There are two distinct climatic regions in Austria:

  • The east shows a Pannonian climate (warm to hot summers, cold winters and relatively low rainfall or snow).
  • The central Alpine region has the characteristic features of the Alpine climate (more rainfall in summer compared to the east and longer winters with heavy snowfall).

Transport in Austria is typically by road, rail or waterways. Passenger transport is by rail, plane and bus or tram.

Vienna has a very efficient public transport system, including an Underground network. Generally for public transport there are different kinds of ticket offers (individual, daily, weekly, monthly, seasonal or annual tickets). Currently the government is establishing a special support system that limits the costs for a yearly pass to 1 € / day. When using the public transport of two different provinces not more than 2 € / day. There are special deals for tourists as well as discounts for certain passenger categories (children, students, retired and disabled people).

Furthermore Austria has a very developed and dense network of highways. Its usage is controlled by a toll system, which requires having a special motorway sticker, which is also available in electronic form.

Educational system

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Children up to 6 years

Before starting with school, children can be taken care of in the following institutions:

  • Nurseries (Babies and very young children: age 0-2)
  • Day parents (age 2+)
  • Kindergartens (age 3-6)
  • Pre-school classes (age 5-6)

Austria has a compulsory school system for nine years in total (usually from age 6-15), offered free of charge for the parents. The rest of the educational training is up to individual preferences and possibilities.

Primary schools

Primary schools are intended for the first 4 years of compulsory education, usually from age 6-10. In these years there is still no separation of kids according to their individual capabilities.

Secondary schools

Starting from age 10 – 14 there are different development opportunities – depending on individual preferences, personal strengths and weaknesses, specific talents and in some cases even the financial background of parents (if we talk about private schools which are no longer free of charge). Here are the different school types:

  • Junior-high school / secondary school: for those who plan to finish their education after the compulsory years (switch to other school forms and later university is still possible)
  • New Middle school: a new type of school offered mostly in cities (trial phase), it is an intermediary way between the lower level high schools and the higher level Gymnasiums
  • AHS / Gymnasium Year 1-4 (lower level): the higher general secondary school for those who plan to extend their education after the compulsory years

After 4 years secondary school there are again various different opportunities:

  • Polytecnical school (age 14-15): is intended for those who plan to finish their education, the focus in this year is on vocational training or orientation as well as preparation for an upcoming apprenticeship (Note: after this year the compulsory school years are over, however the pupil has still just 2 different choices: either the prolongation of the educational career or the completion of an apprenticeship (between the age of 15-18 or 19). In this case there is an opportunity for vocational training (both on the job as well as at the vocational school) for around 250 different professions lasting between 3-4 years, before the apprenticeship is completed with a final exam referring to a specific profession
  • AHS / Gymnasium Year 5-8 (higher level: age 14-18) of the higher general secondary school: intended as preparation for those who plan to have a follow up tertiary education, completed with a final exam and a graduation called Matura (equivalent to the German Arbitur). In return the Matura is qualifying for tertiary educational steps (university, college, academy)
  • Intermediate vocational schools (age 14-18) with a technical graduation at the end
  • Higher vocational schools (age 14-19) with a technical or commercial focus, completed with a final exam and a graduation called Matura (equivalent to the German Arbitur). In return the Matura is qualifying for tertiary educational steps (university, college, academy)

There are also special schools for disabled children or children with special educational needs.

Tertiary educations / universities

Third country citizens (non EU, non EEA or Switzerland with a specific contract) need a residence permit to study in Austria. For citizens coming from EU, EEA and Switzerland there are principally no restrictions for the access to universities apart from the educational requirements itself. Citizens with unlimited residence permit (granted after 5 years residence) are also treated in the same way as EU citizens. However, there are some exceptions for certain studies, for which there are restrictions, which are equally valid for Austrian citizens. Third country citizens need at least an available place at the respective university and they need to proof sufficient knowledge of the German language (apart from the educational requirements).

Principally the access to Austrian universities is free of charge as long as the stipulated minimum period of study (for a bachelor, master or PhD programme) is not exceeded by more than 2 semester. Afterwards there is a tuition fee for each semester. However, for third country citizens there is a tuition fee from the beginning of 2 times the tuition fee payable by EU citizens and legal equivalent persons.

In contrast to conventional universities, the universities of applied sciences offer a vocational and experience oriented education. Unlike conventional universities all courses require a compulsory attending and the total duration of the studies is pre-determined with six semester for a bachelor plus 2-4 semester for a master study. Similarly to conventional universities the studies are awarded with an academic degree (followed by an abbreviation indicating the attending of a university of applied sciences).


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The minimum age for employment in Austria is principally 15, however, there are further restrictions until the age of 18 (employment only for professional training or apprenticeship and only in combination with further educational measures). After passing the age of 18 a person is free to take any kind of job. Apart from the conventional employments (full or part-time) with all rights and duties there are also some special kinds of employment:

Freelance contracts

People with independent employment contracts have limited protection in terms of labor rights such as notice periods for employee resigning or dismissals, holiday remuneration payment and many more. On the other hand they have nearly full access to the social insurance, since 2008 even to unemployment insurance. These contracts are typically used for certain professions like e.g. language trainers etc.

Marginal employment

Marginally employed people are only covered by one part of the social insurance, the accident insurance. Voluntarily these employees may apply for social health and pension insurance, to be paid by themselves. The maximum salary for marginally employed people in 2020 is 460,- € per month. However, people like that may have any other kind of income alongside the marginal employment, even social income of e.g. the unemployment insurance (which would also cover the missing health insurance).

New self-employment

The category of new self-employment is valid for commercial professions that do not require the otherwise in Austria usual trade licenses (e.g. writers, lecturers, psychotherapists etc.). Those people sign in at the social insurance for self-employed, where they are covered for health, pension and accident insurance. Since 2009 they can even opt in for unemployment insurance.


Apprentices have full access to social insurance and an increased protection against dismissal. Contracts with apprentices who haven’t yet completed the age of 18 have to be confirmed by their legal representatives.

Seasonal employment

Seasonal employees have full access to social insurance, but there are specific regulations concerning the working hours according to special collective agreements (typically for hospitality and hotel industry).

Personnel leasing contracts

Leasing employees have full access to social insurance, but they have own regulations in terms of labor rights, especially a reduced protection against dismissal.

Voluntary employment

Voluntary employees are completing a training period, in which there is neither a duty for a defined performance nor a duty for a defined payment.

Advocacy groups

The interests of Austrian employees are represented by the Chamber of Labor and different labor unions. Together with the Chamber of Commerce (interests of employers) respectively the Chamber of Agriculture they are forming the so called social partners of Austria.

As such they are especially responsible for the ongoing setting of minimum standards for salaries and wages as well as other working conditions (in the form of collective agreements).

Employment regulations in Austria

Working time: the normal working time in Austria is equal to 40 hours per week, 5 times 8 hours per day. Surplus hours may be compensated with money or time. In the short run up to 60 hours per week can be required from the side of the employer, however, over a period of 4 months the average working time must not exceed 48 hours per week – in any circumstance.

Holiday: minimum holidays per year for every employee are 5 weeks or 25 days (in case of a 5 days week).

Termination of employment contracts: in contrast to other – even European – countries the Austrian labor law does not require stating any reasons for an “ordinary” termination of an employment relationship – the business relationship will end after the notice period stipulated in the respective collective agreement. Only “extraordinary” dismissals (immediate termination without notice period) are allowed just under the reasons explicitly stipulated by law. In comparison to most other countries this means a lower protection level for employees, but also more flexibility for employers and employees.

Salaries: the Austrian level of salaries is higher than in the most other European countries, currently even higher than in Germany, Denmark, Sweden or France. There is a very important specialty to be considered when comparing Austrian salaries with the ones in other countries: in Austria salaries are paid 14 times per year, so there is double monthly salary payment once in summer and once in winter time (Holiday and Christmas money). But most important is the preferential tax rate of 6% for these extra payments (which is remarkable, especially when comparing with the maximum tax rate of 50%). The overall comparison of individual wealth is usually expressed in purchase power (considering all relevant factors around income – including side costs like social insurance and income tax, but also price levels etc). Austria is ranked 4th in Europe in terms of purchase power (prosperity index).

Labor market

In 2018 the quota of employed people in Austria aged 15-64 has been 73%. The registered unemployment rate in the same year has been at 8,7%.

Both figures together do not sum up to 100% because the unemployment rate only captures people who are entitled to receive unemployment money from the social system, above all it requires earlier employment. Not included are for instance officially registered disabled people, people in early retirement, people who are attending specific trainings to improve their employment opportunities, people attending relevant programs of private corporations and other people who are not entitled to receive unemployment money for different reasons, e.g. because they have never been in the labor market etc.

The registered unemployment rate is therefore also a political figure. However, the calculation is the same for all countries in the European Union, consequently the figures are at least comparable.

If we have a look on the splitting of the unemployment rate we can observe the following pattern in 2018: among younger persons between 15-24 the unemployment rate is 6,7%. People aged 50+ have a rate which is exactly matching the average rate of 8,7%. However, the chances of re-entering the labor market after the age of 50 are then heavily reducing year by year. People with non-Austrian nationality are disproportionately over-affected by unemployment with a rate of 11,3%. The regional comparison between provinces shows the highest rate in Vienna with 12,3% and the lowest rate in Tyrol with 4,9%.

Social insurance

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Social insurance

The Austrian Social insurance is one of the most comprehensive social systems worldwide (Austria is one of 7 countries in the EU that spends more than 25% of its GNP for social purposes – average in OECD is equal to 20%).

It covers the following risks: work accidents and occupational diseases (including consequences like invalidity), sickness, income during retirement, unemployment, maternity, death of the provider of a family and income of the survivor during retirement, nursing care and social need.

The Austrian Social insurance is a compulsory and automatic protection for all kinds of employment and self-employment (some of which have just limited protection – refer to under the headline “Employment”).

The financing is provided by a certain percentage of the salaries (up to a maximum monthly gross salary of 5.370,- €) reserved for the respective purposes and collected from the employer as well as a contribution by employers themself and support from the state (taxes). As the contribution is a percentage of the salary, people with higher income contribute with higher amounts than people with lower income. For some of the social incomes there is a clear relation between contribution and final payments out of the social pot.

Apart from the social insurance there is also a system of minimum income intended to close any open gaps of social security.

Health Care

Apart from the few already mentioned exceptions all people who are employed or self-employed have a social health insurance. The same appears for retired and unemployed people as well as all direct family members of the mentioned groups – for children in education up to the age of 26 (without any surplus contribution).

This means that nearly all medical services including hospitalization are covered and paid by the social insurance (apart from very small contributions). Medication is not given out directly by doctors but prescribed, people can fetch the medication afterwards from the pharmacy against payment of a small fee (also the medication is supported by the social insurance). The existence of a social insurance coverage is proved by a special card, the so called e-card.

In case of longer sickness employers are committed to continue their salary payment for up to 12 weeks, after that the social insurance is stepping in with the payment of a sickness money, which is, however, no longer on the level of the salaries. The sickness money is paid for a maximum period of 52 weeks, before a patient may apply for care allowance or disability pension.

On top of that there are also private doctors and even private hospitals that may be selected, however, the value added by these services has much more to do with comfort than the quality of the medical services, which are excellent in an international comparison. This fact might be quite surprising for people coming from other parts of the world, where they have to pay a large proportion of their medical services by themselves. Services of private doctors have to be paid by the patients themselves, however, also in this case part of the money is reimbursed afterwards.

Income and Taxes

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Income and Taxes

Austria has a progressive income tax system with tax levels from 0-50% for the highest incomes (and even 55% with a limited validity period of 5 years). The tax levels are the following:

  • yearly incomes of up to 11.000,- € are tax free
  • 11.000,- – 18.000,- à tax rate of 20%
  • 18.000,- – 31.000,- à tax rate of 35%
  • 31.000,- – 60.000,- à tax rate of 42%
  • 60.000,- 90.000,- à tax rate of 48%
  • 90.000,- – 1.000.000,- à tax rate of 50%
  • incomes over 1.000.000,- € à tax rate of 55%

(valid until 2025, afterwards presumably again 50%).

The respective incomes tax is only valid for the corresponding tax level, and not for the whole range of income.

Like social insurance the incomes tax is collected by the employer and forwarded to the tax authorities. For certain family circumstances there is tax relief.

Austria and the European Union

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Austria and the European Union

Austria joined the EU in 1995. The overall economic development after the entry into the Union may be qualified as very positive, Austrian development is a real success story: the real GNP of Austria increased by 9,7%, every year, an additional 13.000 jobs have been created, the yearly direct investments into Austria tripled since then. Last but not least, the export figures reached 150 billion € in 2018.

According to the forecasts Austria will again profit from the already planned further enlargements of the EU – the GNP will rise by 0,15% more than without the EU enlargements according to the forecasts. A very important reason for the growth may be seen in the geographic position of Austria with the expansion countries all situated relatively close.

Today Austria is clearly among the richest countries in the European Union in terms of GNP per capita, slightly ahead of Germany and clearly ahead of France and Great Britain.

Economic frame conditions

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Economic frame conditions

Even before the entry into the European Union Austria had been well respected for its stability in legal and political environments.

This stability has been significantly and continuously promoted by a special system of collaboration between unions of employers and employees, the so called Social Partners in Austria. The social stability in return is a very important factor for decisions concerning new business allocations of international corporations.

One factor that can be seen as one of the very few pitfalls for business location decisions is the comparably high “side costs” for salaries, above all the social insurance and also from the perspective of the employees the comparably high incomes taxes. That is why Austria’s government started initiatives for the lowering of the “side costs” for salaries.

However, the state revenue from taxes is also used to fund a comprehensive system of state support where needed, above all to mention the support systems for the formation of companies or innovative projects.

And the only factor that counts for consumers is the amount of goods and services you are able to buy out of the available income, thus also considering various price levels and many other factors, finally measured in the so called purchase power. Referring to the purchase power evaluation Austria is finally among the top countries in the EU again.

Economic profile Austria

2016 2017 2018
Real GNP
(growth in comparison to previous year in %)
2,0% 2,6% 2,7%
(evaluation on current prices)
€356,24 billion €369,90 billion €386,15 billion
GNP per capita
(evaluation on current prices and purchase parities)
€37.480 €38.190 €39.290
Investment quota
(gross fixed capital formation in % of GNP)
23,2% 23,6% 23,9%
Employment rate
(share of population in employable age)
76,2% 76,4% 76,4%
Unemployment rate 6,0% 5,5% 4,9%
Inflation rate 1,0% 2,2% 2,1%
(in % of GNP)
3,15% 3,16% 3,17%
Export rate
(export of goods in % of GNP)
37,1% 37,9%  38,4%

Quelle: Eurostat, Europäische Kommission (Ameco Datenbank), WIFO, Statistik Austria (04/2019)

State support for businesses

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State support for businesses

Especially for foreign investors there is a wide range of different support programs, here are the most important ones: 14% research bonus for R&D-investments (european bench mark), investment-growth-bonus for small and medium-sized businesses (depreciation in books for large scale corporations), refund of salary side costs for innovative start ups or the creation of new jobs (up to 100% of salary side costs for 3 employees for 3 years), privileged forming of public limited companies (reduced capital requirements), venture capital funds of the public sector, up to 20% risk capital bonus for the investment in innovative start ups.

Research & Development

Since Austria joined the EU, the research quota more than doubled to 3,17% of GNP in 2018, reaching the second highest quota in the EU, right behind Sweden and in front of research-intensive countries like Germany, Denmark and Finland. Apart from a short term focus on investments for overcoming the worldwide pandemic crisis, Austria’s investments in R&D and subsequently the research quota shall further increase. The biggest share is coming from the corporations doing R&D itself, followed by the public sector and international corporations that are holding R&D-subsidiaries in Austria and a very small portion is coming from the private non-profit sector.

This development is due to a wide range of different support for investments in R&D as well as a tax system that also favors further investments in R&D:

R&D bonus of 14%: Applicable to every company irrespective of size, branche or structure, including all relevant costs (even overhead costs), which is a big advantage esp. for asset-intensive investments, no limit for the assessment base for self-operated R&D, not only as tax deduction and therefore not dependent from sufficient profits – attention: the Austrian 14% R&D bonus can easily be higher than the 25% R&D-support in Germany, especially for connected group companies of a corporation (apart from already mentioned reasons because of the less restrictive conditions concerning connected group companies).

Other R&D-support and start up funding services: www.investinaustria.at/en/research-development/investment-incentives.php

Furthermore there is a dense network of R&D-Cluster organisations representing the central platforms for cooperation and interaction in the respective research fields.


Start Up Founding

The start up scene in Austria, and above all Vienna has literally been exploding over the last years – or – to put it into the words of start up founders – the scene has been developing to a real central European hub.

Most start ups align their products and services with global markets and therefore also absorb impulses of very often international investors. Vienna as biggest European location for universities with its 20 universities and over 200.000 very international students appears quite attractive for founders that are not only coming from the European Union but also from third countries.

The following factors are contributing to the attractivity of the start up scene:

  • Relief from salary side costs: refund possibility for 3 employees for 3 years
  • Risk capital bonus for investors: refund of up to 20% of invested risk capital with an amount of up to EUR 250.000,- per year, supported by aws (Austria Wirtschaftsservice GmbH)
  • Separate residence title for start up founders
  • aws Business Angel Fund: supports investments of selected business angels in quick growing technology companies in the form of Co-Investment agreements. Since 2013 the fund has been doubled.
  • aws Seed Financial Programme: supports the establishment of the company structure for scientific and technology driven companies
  • Digital One Stop Shop for founders: all data may be entered online into a central, governmental service portal

Forbes Magazine: “Why Vienna is the best place to start a business” (Alison Coleman): https://www.forbes.com/sites/alisoncoleman/2019/09/10/why-vienna-is-the-best-place-to-start-a-business/?sh=16b314ea4f29

The Most important funding agencies for start ups:

  • FFG (Forschungsförderungsgesellscchaft) and aws (Austria Wirtschaftsservice GmbH): non-refundable granted funds, warranties preferential credits
  • Local Risk capital companies, e.g. Speedinvest
  • Numerous Business Angels
  • Wirtschaftsagentur Wien: apart from monetary support also consultation and service support as well as access to low budget office space

Economic sectors in Austria

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Automotive Industry

Austria has a strong Automotive industry with a couple of Original Equipment Manufacturers (OEM) producing in the country: BMW (biggest plant for motor production in the whole BMW Group), MAN / VW (light and medium-heavy trucks, production of nearly 50% of all cabs produced in the group), Audi, General Motors (production of 50% of all Opel transmissions and 30% of all Opel motors) and Jaguar. But also worldwide Top Automotive Tier 1 suppliers have some of their plants situated in Austria, e.g. the austro-canadian Magna Group (one of the biggest subsuppliers worldwide) or the Robert Bosch AG, better known as the BOSCH Group (with 3 sites in Vienna, Linz and Hallein which have the function of international development competence centers of the mobility technology – and many more.

Research & Development is of paramount importance on the Austrian Automotive market with several very important, specialized research institutions. The share of 13,7 % of researchers on the total number of employees in the industry even represents the peak value of all industries. Furthermore a close connection to university institutions is very characteristic for this sector.

And finally the Automotive corporations and specialized R&D institutions are further organized in specific networks, the Automotive Clusters.

By the way, between 2011 and 2015 67% of the total number of patents (around 350) in the Austrian Automotive industry have been related to the hot topic in the industry: electromobility. This means second place in the European ranking.

Chemical Industry

Also the chemical industry is of utmost importance in Austria – with around 10% of the whole R&D expenditure in Austria and slightly higher than 10% of the workforce in production companies.

For Global players like Borealis, Henkel and Sabic Austria is clearly the location to steer the whole Eastern European market, whether in terms of production, processing or R&D. Borealis even has its Headquarter and central R&D unit in Linz, Austria.

According to the famous Henkel Group Austria serves as competence center and High Tech location for whole Central and Eastern Europe.

In particular we are talking about the following sub sectors: raw material production, plastics processing and mechanical engineering for plastics, tool and mold production, recycling of plastic products, R&D institutions.

Like the Automotive industry, the chemical industry including specialized R&D institutions are further organized in network Clusters, in this case the so called Plastics Clusters. Their activities are even cross border activities, especially involving Eastern European Countries, this way contributing to a best possible growth of the industry.

Environmental Technology

Austria is one of a couple of early pioneers in the environmental sector, whether we talk about solar energy, wind power, electromobility, environmental technology, renewable energy or recycling and waste management.

Austria may be found in a worldwide Top 10 position in nearly all Rankings concerning environmental protection. One of the most important evaluations from the universities of Yale & Columbia, is the Environmental Performance Index 2018, in which Austria is ranked 8 (out of 178 countries worldwide).

60% of the power generation in Austria is coming from water power, which is corresponding to the peak value in Europe and one of the highest rates worldwide. This is why Austria’s expertise in this field is advanced.

The second most important energy source in Austria is bio-mass, a field in which Austrian companies are quite frequently holding a technological leadership function. Similarly important is the standing of Austrian companies for wind turbines and solar energy. Unbelievably 12 % of the Austrian environmental technology companies are either world – or European market leaders. Two thirds of their sales volume is coming from markets abroad.

Correspondingly there is also a comprehensive pot of national support systems in this sector. The governmental climate and energy strategy “#mission 2030” underlines the national importance of this field.

Finally also the environmental sector and their specialized R&D institutions are further organized in different, specialized environmental Clusters. The internationally most well known corporations in this industry are probably Siemens and Kärcher. Siemens Austria is managing the so called “Siemens-Cluster Central Eastern Europe” from Austria, a network that spans 18 different countries in Europe. Similarly also Kärcher is operating their Head Quarter for Central and Eastern Europe in Austria.

Electronic Industry

The Austrian Electronic industry is another giant among the Austrian branches. With around 70.000 employees 2017 this sector is Austria’s second biggest industrial employer and extremely export oriented (2/3 of the products are sent to over 150 different countries in the world, 1/3 of the whole R&D expenditure is done by this industry). No wonder a large number of well known international companies are producing in Austria: Infineon, Eaton, Alcatel, Hewlett Packard, Siemens, AT&S, Andritz Hydro, austriamicrosystems (ams) and many more.

By the way: it is no coincidence that the lighting of the famous tower clock in Mekka is coming from Austria.

Information and communication technology

Closely connected and even bigger in terms of the number of employed (290.000) and a GNP share of 8,6 % is the share of companies belonging to the Austrian information and communication industry. Austria is considered to be among the Top 3 R&D-locations in the field of information and communication technology.

E.g. Talking about the Chip-production the R&D-quota is on the high level of around 15-20%. 

Consequently there is also a variety of different support programs of the public sector with quite impressive support volumes involved. Subsequently there is for instance a lot of Austrian competence involved in most smart phones (e.g. semiconductor disks from AT&S or sensors from ams). Furthermore entrance systems for public spaces like airports, sports stadiums or ski lifts are quite frequently coming from the Austrian company SKIDATA.

Other well known corporations producing in Austria are corporations with dominant world market positions like Infineon, Frequentis, Kapsch, Siemens, Philips or Microsoft with an own R&D-subsidiary in Graz. Another big player is the Austrian company TTTech specialized in electronical safety technology – the German Infineon group and the US corporation General Electric are holding shares on TTTech.

The importance of the co-operation between science, R&D, industry and economy is underlined by a support program in the value of 1,5 billion €, called COMET (Competence centers for Excellent Technologies). The target of this program is the exchange of knowledge among experts and its utilization as well as the building of mutual R&D competence.

Frequently used catchphrases treated by different programs are for instance “Virtual Reality” or “Artificial Intelligence”. Almost everybody meanwhile knows virtual assistants like Siri or Alexa, but AI e.g. also enables the forecast of the best possible time for the exchange of critical machine parts, e.g. security parts.

Data Centers

Austria is serving as a high-performance pan-european hub of electricity networks, optic fiber networks and gas pipelines. Furthermore all relevant carriers are represented in the peering matrix with the Vienna Internet eXchange (VIX) serving as the interface for Central and Eastern Europe.

International Data Center Providers like Atos, IBM, Interxion, T-Systems are present in Austria. And recently Google has been setting up infrastructure.

A frequently used catchphrase in this field is the so called “Digitalization”, often referred to as the fourth industrial revolution or industry 4.0 after the digital revolution itself as the 3rd industrial revolution. Digitalization means the intelligent linking of the whole production chain – from the planning to the processing and all involve production logistics including all related highly sophisticated services.

We are specifically talking about a cross-sectional matter touching the topics of information and communication technology, mechatronics, electronics and others.

And one more time a dense network of specialized Clusters is ensuring the best possible cooperation between science, R&D and economy in this field.

Also for the Austrian government Digitalization is one of their main agenda items reflected in the so called “Digital Action Plan” of the government.

Finally there are a variety of very important projects in this field, let us pick just one of the most important to be mentioned here: the R&D project “Semi40” (also titled as “Power Semiconductor and Electronics Manufacturing 4.0”) is one of the biggest Digitalization projects in Europe with a volume of over 60 Mio. €, under the direction of Infineon Austria. The project is treating the self steering of factories, further catchphrases would be “intelligent production” or “cyberphysical production systems”.

Life Sciences

Life Sciences is usually a term used for the conglomeration of the following sub sectors: biotech industry, pharmaceutical industry and medical technology. These sectors together are generating 5,8% of the GNP in Austria, more than 55.000 people are employed in these industries.

The most important corporations have usually been settling in or near Vienna: Böhringer Ingelheim (German corporation with their huge R&D location in Vienna), Octapharma (Swiss corporation with newly built R&D center in Vienna), Novartis/Sandoz, Merck, Fresenius Medical Care (with a new R&D center) and Pfizer (with their international quality control center in Orth/Donau, not far away from Vienna).

Also in Vienna one of the leading biomedical R&D-centers in Central & Eastern Europe has been emerging, the Campus Vienna Biocenter.

The highest R&D rate is given in the biotech industry (14,4% with around 1 billion € R&D-investment per year), where 2,8% of the GNP is generated.

Especially in the pharmaceutical sector Vienna has a strategic function for the growing markets in Central and Eastern Europe.

Also worth mentioning is the success of the excellent Research institutions for cancer: today the mortal risk of cancer has been reduced by 25% and new cases of cancer have been decreased by 12% in the last 25 years, Austria is ranked number 4 in Europe in terms of survival rate.

In general R&D in the field of Life Sciences in Austria enjoys excellent reputation worldwide. Whether we talk about public institutions like The “Österreichische Akademie der Wissenschaften” – e.g. the CeMM Research Center for Molecular Medicine or the Austrian Institute for Technology, the biggest R&D technology organization. Apart from numerous other very specialized R&D institutions also the corporations itself have R&D units in Austria with international or even worldwide reputation.

Also in the field of Life sciences there are numerous local and national Clusters, connecting corporations with universities, customers, development partners and other institutions.

Logistics industry

The position in the very heart of Europe makes Austria a perfect location for logistical distribution centers. Further pros are the sophisticated infrastructure (e.g. excellent connections from the Viennese airport especially on the East-West route, low rental costs for storage areas, intermodal terminals for road, rail and water), finally the excellent Know-How for deliveries to Central and Eastern Europe.

In 2014 Lufthansa switched their distribution center for Eastern Europe from Budapest to Vienna, similarly also corporations like Volvo, Rewe and Fresenius use Austria as logistics hub.

The reputation of Austria’s logistical competence is evaluated in worldwide TOP positions in several rankings. The World Economic Forum for instance sees Austria on position 8 worldwide (energy supply rank 4, road network rank 6, rail network rank 12).

The Danube enables water transports both to the North Sea as well as the Black Sea. Via Railway there is also a quick connection to the Adriatic ports of Koper, Venice, Triest, Ravenna and Rijeka, which enable quick transports to Far East as well as the Baltic Area.

Like in many other branches a whole lot of logistical Clusters is responsible for an efficient Know-How tranfer between corporations, science, Research institutions and other organizations.

Mechanical Engineering

In the mechanical engineering sector, another 80.000 people find employment, not including a further 15.000 people who are engaged in maintenance. The whole branch is generating a volume of more than 20 billion €, which is exceeding the average EU value of the industry.

The main survival strategy of Austria in the industry is the offering of a remarkably higher share of high quality niche products in comparison to other European competitors.

Generally speaking, lower standard products are being produced in other parts of the world, while European countries can still benefit from their technological superiority.

A lot of corporations in this field have very strong global reputations, such as Andritz, Engel or Doppelmayr, also to be mentioned Liebherr and Palfinger.


The fact that the 2 biggest Austrian corporations have still not been mentioned also shows the big potential of the Austrian economy. Those two companies are OMV (mineral oil production and related fields) and voestalpine (steel production and cross-sectional technology company).


Apart from the economic strength of Austria it is also one of the touristic giants in Europe (attraction number 1 is the mountainous region in the west both for winter tourism – with its famous winter sports centers – but also summer tourism. However, there are also strongholds of city tourism with the 2 main Highlights Vienna and Salzburg).

Even in total Austria is able to compete with countries that have fabulous touristic attractions on the seaside. According to the World Economic Forum, Austria is listed at position 12 worldwide in terms of attractivity and development potential of its tourism. The same position applies in the index of international tourist visitors per year – position 12 worldwide in 2018 with France and Spain on top of this list followed by the USA. In terms of tourist service infrastructure Austria is awarded world champion – number 1 worldwide.

Here are some financial hard facts from 2016: income from tourism more than 40 billion €, highest growth in overnight stays in whole EU (more than 70% from abroad), more than 40 Million visitors.

Of course figures like that also attract international investors, above all the big names in the Hotel industry.

Finally there is even an own tourism and hotel bank institution (the ÖHT) that is supporting investments in tourism.

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