Austrian industry faces relocation threats due to high costs

According to the latest Industry Radar from the Austrian Federal Economic Chamber (WKÖ), one in four industrial companies in Austria is considering relocating parts of its procurement, production, or distribution abroad.

While Austrian industry benefits from reliable energy supplies, strong infrastructure, and favorable research and development conditions, these advantages are being offset by high structural costs. The primary concern cited is high unit labor costs, with 96% of surveyed companies rating Austria unfavorably compared to international competitors. Other significant pressures include energy prices and the burden of taxes and duties.

Global geopolitical factors are also increasing pressure on export-oriented firms. Specifically, 80% of companies view increasing global competition as a major challenge over the next three to five years. This includes rising competition from China and the impact of US trade policies. To combat these pressures, 82% of businesses are focusing on cost and efficiency measures, while 61% are pursuing automation and digitalization.