Vorarlberg’s productivity is growing

In an OECD comparison, Austria's productivity ranks well in the middle, ahead of Germany and the UK, among others. However, a look at the development shows that Austria's productivity has been stagnating for years: Average productivity growth between 2010 and 2016 was just under 0.1 percent per year. Together with Luxembourg, Finland, Italy and Greece, Austria is therefore one of the five countries with the lowest productivity growth. This is shown in the latest OECD report Regions and Cities at a Glance 2018, which allows a comparison of regional development within and beyond national borders.

However, productivity is not stagnating everywhere in Austria. The region with the highest productivity growth in recent years is Vorarlberg. Productivity there has risen by an average of 1 percent per year since 2000. Vienna stands out in several respects: in 2016, the federal capital was the most productive region in Austria. However, this top position is no longer set in stone. Productivity has been falling steadily since 2007 and in 2015 Vienna was overtaken by Vorarlberg for the first time. In addition, the unemployment rate in Vienna is around five percentage points higher than that of Austria as a whole. The differences in youth unemployment are even more pronounced. While the rate in Austria as a whole is 9.8 percent, 16.7 percent of 15 to 24-year-olds in Vienna are unemployed. This means that youth unemployment in Vienna is even higher than the OECD average and also higher than in other major cities such as Hamburg, Munich or Berlin.

Education plays a key role in a future-proof labor market. Training and further education as well as lifelong learning are essential in times of demographic change and digitalization. It is also important to integrate the considerable number of young people and long-term unemployed into the labor market with relevant educational measures.

Annual productivity growth, 2010-2016