Addressing Regional Labour Market Imbalances in Austria

Austria faces large geographic labour market imbalances, with high unemployment in Vienna and labour shortages in other parts of the country. These imbalances negatively impact the economy, workers and public finances. Since few jobseekers leave the capital to work in other parts of the country, promoting the geographic mobility of workers and jobseekers from Vienna into regions with high labour demand has become a priority for the Austrian government and the Austrian Public Employment Service (Arbeitsmarktservice - AMS). Supporting jobseekers in moving from Vienna to regions with stronger labour demand in the short run requires the AMS and the Austrian government to expand its target group of jobseekers considered for cross-regional placement and its current set of mobility-enhancing policies, including financial incentives, information provision and training programmes. Addressing the geographic labour market imbalances in the long-term, requires co-ordination across ministries and levels of government to tackle the underlying institutional and structural factors, namely the regional differences in family-related social benefits and the housing market, as well as the integration of refugees, thereby also advancing its regional development objectives outside the capital.