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Austria’s 14 skills challenges

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Developing its relevant skills


Age differences in literacy proficiency

Trend scores in literacy, by age, foreign-born adults excluded, selected countries, 2012

Age differences in literacy proficiency Austria

‌Note: A cubic specification of the trend curves is found to be most accurate in reflecting the distribution of scores by age in most countries. Foreign-born adults are excluded from the analysis. See corresponding table mentioned in the source below for regression parameters and significance estimates.

Source: OECD (2013h), OECD Skills Outlook 2013: First Results from the Survey of Adult Skills, OECD Publishing., Table A5.2 (L)‌ 


1.       Expanding access and improving quality of early childhood education and care (ECEC): Despite the rise in participation from less than 8% in 2000 to more than 20% in 2012, enrolment of under 2-year-olds remains low in Austria compared to the OECD average of 33% in 2010. Limited hours of services also contribute to low levels of participation. Higher levels of enrolment would be especially helpful for children with a migrant background, or language problems, to improve transitions to primary schooling. Austria is making progress towards ensuring high nationwide quality standards, yet more needs to be done to help ECEC staff develop the skills needed to implement the new quality framework, such as providing language support.

2.       Improving quality and equity in compulsory education: 15-year-old students in Austria perform below the OECD average in reading, around average in science and above average in mathematics. Austria needs to do more to strengthen equity in education. Low performance is strongly related to students’ socioeconomic status and migrant background, more so than in other OECD countries. Only 6% of students with low socio-economic status belong to the top quarter of students from all countries, compared to 13% of the student population in the best performing countries.

3.       Strengthening foundation skills and labour market links in vocational education and training: According to the Survey of Adult Skills, about a third of VET-graduates aged 16–29 years-old score below the international average for VET graduates, at about level 2 (out of 5) on the literacy scale. In practice, this means that they were not able to understand dense and lengthy texts. Low results were found particularly among graduates from apprenticeships, mediocre results among graduates from VET schools (BMS), while good results were found among graduates from VET colleges (BHS). Graduates with low-level foundation skills are less prepared to acquire new skills and adapt to a changing skills demand. Austria’s VET system can build upon its strengths to provide more advanced skills and respond better to skills trends, such as the need for solid ICT-skills in all occupations.

4.       Meeting economic demand for high-level skills: Austria’s tertiary graduation rate (tertiary-type A) has increased from 10% in 1995 to 35% in 2011 but is still below the OECD average of 39%. Yet the supply of tertiary-educated people is lower, as international students comprise 15% of all enrolments but only a sixth of them stay in Austria after graduation. Supply may fall short, especially for graduates in science, who are in high demand. Ten per cent of new entrants choose to study sciences in Austria, which is within the OECD average, but may be low considering the relatively scarce overall tertiary supply. In addition, national studies suggest that the quality of higher education needs to be improved as there are substantial shortcomings in student satisfaction with the learning environment, especially at academic universities which also see high dropout rates (35% compared to 30% OECD average in 2011).

5.       Expanding adult education, especially for low-skilled people: According to the Survey for Adult Skills, the foundation skills levels of adults in Austria are below average in literacy, above average in numeracy and around average in problem solving in technology-rich environments. People with high levels of foundation skills are found to participate most in both job-related and non-job related adult education, while participation rates are lowest amongst people with low-level foundation skills.

6.       Improving people’s ability to navigate the skills system through effective guidance and flexibility: Austria offers many educational pathways, but lacks a comprehensive lifelong learning guidance system that can draw upon up-to-date labour market information. Gaps in the provision of career guidance and low upward-mobility have a particularly negative impact on the educational and employment careers of disadvantaged people, such as those with a migrant background and low socio-economic status.


Activating its skills supply


GDP and labour force projections, converging male and female participation rates

GDP and labour force projections Austria

Notes: (a) The labour force projections are based on population projections for persons aged 15 years and older, rather than persons aged 15-64, to be consistent with the growth model outlined in OECD Economic Outlook, No. 91

Source: OECD Secretariat’s estimates based on the OECD Economic Outlook, No. 91 long term database (Version 6, June 2012), OECD Population and Demography Database and the OECD Employment Database.


7.       Enabling women to fully participate in the labour market by improving the work-family balance: In Austria, motherhood makes inactivity and part-time work more likely than in most other OECD countries. Prolonged durations of part-time work are associated with lower career prospects, lower earnings, and fewer opportunities to participate in training. The part-time salary rate for women is lower in those Austrian Bundesländer with better access to early childhood education and care, especially for under 3-year-olds. Yet even when childcare options are available, Austria’s employment policies and the tax system encourage women to work part-time instead of full-time.

8.       Retaining older people and people with moderate health problems in the labour market: Austria still has the second lowest effective retirement age in the entire OECD, for both men (58.5 years) and women (58 years). Recent reforms of the invalidity pension could lead to rapidly rising unemployment of older people with partial work capacity. In order to better retain older workers and to stop the outflow of their skills in the future, efforts will be needed to better integrate older (unemployed) people and people with partial work capacity into the labour market.

9.       Activating the skills of migrants: International migration accounts for a third of new entrants into Austria’s working-age population. But migrants have far lower labour market outcomes than native-born Austrians. The children of immigrants aged 20-29 are four times more likely to be both low-educated and neither in employment nor in education and training (NEET) than their native-born counter-parts. At all ages, highly educated first- and second-generation immigrants are penalised most in terms of whether they are in skills-adequate employment. Only 55% of highly-educated immigrants are employed in high-skilled jobs compared to 70% of their highly-educated native-born peers.


Using its skills effectively


Human resources in science and technology

Human resources in science and technology Austria

Note: "Professionals" and "Technicians and associate professionals" are defined according to the International Standard Classification of Occupations 2008 (ISCO-08) major groups 2 and 3 respectively, except for Brazil, for which the corresponding ISCO-88 groups are reported. For Brazil data are drawn from the Labourstatistics Database maintained by the International Labour Organization (ILO) and refer to 2009. For the United States, data refer to March 2012, based on the Current Population Survey (CPS). CPS data were converted from US 2010 census codes to 1-digit ISCO-08 major groups via published correspondences with US 2010 Standard Occupational Classification (SOC) codes.

Sources: OECD (2013t), OECD Science, Technology and Industry Scoreboard, OECD Publishing,, based on European Labour Force Surveys, Eurostat, July 2013; ILO Labourstatistics Database, July 2013; and national sources. 


10.       Encouraging employers to make better use of skills: In Austria, people reported below average use of numeracy, problem solving and computer use at work (OECD, 2013h). This raises the question whether workplaces in Austria are prepared for the digitalisation of the economy. In addition, Austrians encounter severe skills mismatches on the job with respect to both the use of information-processing skills and skills related to their field of study. The skills of women, older workers and people with a migrant background are used least effectively on the job.

11.       Creating a skills system that supports innovation: Looking ahead to 2020, Austria’s economic strength is projected to continue to be rooted in vocationally oriented medium-level skills. However, growth rates for occupations that currently require tertiary degrees are projected to accelerate, especially in areas of science and technology. Areas of high potential include ICT intensive sectors, green innovation and health.


Strengthening Austria’s skills system


12.       Financing a more equitable and efficient skills system: In Austria, the complex fiscal equalisation system, which distributes public funding across government levels, hinders the capacity of policy makers and civil servants to steer the skills system. Austria faces challenges in how to better allocate funding to underdeveloped areas of the skills system. For example, adult education is largely financed and provided by the public employment service (PES), which only reaches the unemployed. Yet only 5% of the low-skilled are unemployed, while most are in employment (62%) or inactive (33%) and cannot be reached by the PES. Employers’ investments in training largely benefit high-skilled members of the population.

13.       Improving governance and responsibility structures: Austria has a highly complex skills governance system, with shared responsibility between various ministries and agencies as well as levels of government, characterised by strong social partner involvement. This has generated a relatively inclusive and stable policy process with a high degree of ownership among social partners. However, the system is fragmented and inflexible, and strategic steering measures, which involve all relevant actors to improve coordination and deliver better skills outcomes, are lacking.

14.       Improving the evidence base for the development of the skills system: Austria faces the challenge of generating and using data with the view to evaluate the effectiveness and efficiency of its skills policies. While most federally-funded programmes are regularly evaluated, programmes of the Bundesländer have received far less scrutiny. Tackling local skills challenges and evaluating pilot projects requires disaggregated data coupled with capacity building at the regional and institutional level.


For further information, see the:

OECD Skills Strategy Diagnostic Report: Austria | Overview | Executive Summary

OECD Skills Strategy | OECD Skills Strategy infographic  


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