Even in the current recovery the regional growth pattern of Austria's economy remains characterized by an unusually high degree of uniformity. Structural factors and the improvement in locational factors in the eastern part of Austria determine the pace of the upswing, which is more highly synchronized than in previous business cycles. Austria's value added – excluding agriculture and the energy sector – grew by 3.2 percent in the first quarter of 1994 on a year-on-year basis. About half a percentage point is accounted for by an increase in construction output that made up for weather-induced output losses in the winter of 1993; nonetheless, the signs of an incipient upswing are clear. Manufacturing output has advanced at an above-average pace and employment has risen by 26,000 (+0.9 percent) on a seasonally adjusted basis since the beginning of the year. When Germany, laboring under reunification, abandoned its role as Europe's engine of growth, the traditional pattern of a gradual West-East transmission of the business cycle vanished. Styria (+3.1 percent), Carinthia (+3.8 percent), Upper Austria (+3.5 percent), and Salzburg (+3.6 percent; value added excluding agriculture and energy) followed the same pattern; in Tyrol (+2.3 percent) and Vorarlberg (+4.0 percent) the deviations are mostly due to a base effect. Economic activity in the eastern region also expanded by 3.2 percent, but Vienna, with a growth rate of only 2.1 percent, lagged behind Lower Austria (+5.0 percent) and Burgenland (+5.9 percent). In distribution, finance, insurance, and real estate, as well as the public sector and other service sectors production facilities have for some time now been shifted from the centers to surrounding areas. It is quite possible that Burgenland has entered the take-off phase of economic growth: during the last two years economic activity grew at a rate that was 5 percentage points higher than in the rest of Austria, with about half of this extra gain due to additional jobs, the other half due to higher productivity growth. Construction activity in Burgenland has soared. A remarkable side effect of the unusually high capacity utilization is that the seasonal gap narrowed by one third, an indication that seasonal unemployment is, in part, only a bad habit carried over from the past.
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Volume (Year): 67 (1994) Issue (Month): 8 (August) Pages: 466-471 Download reference. The following formats are available: HTML
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