Economic Activity and Growth in Austria: A Rendezvous with Reality

Despite the current recession, Austria is still one of the richest countries in the world. However, since 2010, the country has gradually lost ground compared to other countries in terms of real per capita income. For almost 15 years, Austria has had a persistently higher inflation rate than the euro area as a whole and the real value of GDP per capita is growing at a substantially slower rate. The long-effective globalisation dividend is no longer flowing; demographic factors are becoming increasingly important, and competitiveness is being lost. Therefore, Austria urgently needs to tackle structural reforms aimed, among other things, at a better integration of immigrants, a higher labour force participation and an improved education system.