Experts Warn: Only Radical Trend Reversal Can Prevent Austria's Total Collapse
The consulting firm Deloitte sees Austria's economic location "in a nosedive." The downward trend has "further accelerated in recent months," warn the consultants in their location report "Deloitte Radar 2025." They recommend the new ÖVP/SPÖ/NEOS government to "act quickly." An immediate program is necessary as a "signal for a new beginning."
"Deloitte Radar" analyzes Austria's competitiveness
As part of the "Deloitte Radar," the consulting firm has analyzed the international competitiveness of Austria's economic location for the eleventh time. In addition to surveying around 600 executives and analyzing economic rankings, a special survey of leading European nations and best-practice projects was conducted for the first time.
"Austria's economy is in the third year of a recession, the longest of the 2nd Republic, and is thus at a 'tipping point'," said Deloitte Austria CEO Harald Breit in a press release. Competitiveness has "further deteriorated," and the economic location has been "left behind" in international comparison.
Austria has been falling back in the rankings for years
Deloitte referred to the prestigious competitiveness ranking of the Lausanne business school IMD among 67 countries, in which Austria's economy has significantly fallen from 16th place to 26th place since 2020. In the intra-European comparison, Austria was recently only in 12th place. The gap to the leading countries Switzerland, Denmark, and Ireland is getting bigger, according to the consultant. "We need a trend reversal. Austria must move from a nosedive back to a climb, otherwise a crash landing threatens with serious consequences for prosperity and social cohesion," said the Deloitte Austria CEO.
Executives see sentiment as negative
In the Deloitte survey, more than 60 percent of executives described the general sentiment at the business location Austria as "very negative" or "rather negative." Only around 18 percent had a "positive" or "very positive" assessment. This is the worst value since the start of sentiment surveys, according to Deloitte. "Excessive bureaucracy" as well as high wage and energy costs are among the main problems for companies.
Denmark, Switzerland, and the Netherlands as a model for Austria
The consultants recommend that Austria's policy take a closer look at successful policy measures from other countries. Denmark provides a "model example of a successful labor market reform" with its flexicurity model, which relies on flexibility and a socially secured but time-limited form of unemployment support. In Switzerland, a job registration requirement in professions with high unemployment enables "individual job placement." And the Netherlands promote their start-up scene, among other things, through a targeted visa policy for foreign top talents. "The best practices are there, we should use them," said Deloitte partner Elisa Aichinger.
(APA/Red)
This article has been automatically translated, read the original article here.