Structure of agriculture[

Services

At the beginning of the 21st century, the service sector employed roughly two-thirds of Austria’s workforce and generated the large majority of the country’s GDP. However, this should not be interpreted as an indication of rapid economic modernization or of the swift development of high-technology service industries. Services, more than any other sector of the Austrian economy, were clearly dominated by the government. Public services were particularly expanded in connection with the so-called “controlled capitalism” concept of the post-World War II years, whereby the social welfare state, through the nationalization of companies, aimed to create more jobs, particularly protected jobs. The public sector also reached out into once privately performed services: banking and insurance; teaching at all levels; cultural institutions such as theatres, symphony orchestras, and operas; transportation and communication; all levels and kinds of administration; and the general health care system, including hospitals, clinics, and most retirement homes. In all, a minority of service jobs are in the private sector, while the government at all levels (local, state, and federal) still controls the majority.

Getreidegasse
Despite its leading contribution to the economy, the service sector in Austria creates rather little new money, with the exception of financial services, some services offered abroad (such as banking in eastern European countries), and tourism. Indeed, tourism is Austria’s most important invisible asset. With its picturesque landscape, villages, towns, and cities; its highly developed hotel and catering industry; its renowned facilities for skiing and other outdoor sports; its spas and resorts; and its fabled cultural institutions—not to mention its relative ease of access—Austria is to the outsider a tourist destination par excellence.

Labour and taxation

Government at various levels remains an important job provider, though to a much lesser degree than it was in the mid-20th century. Public sector jobs are protected, meaning that the government ensures automatic wage raises, certain bonuses, and most often tenure for life—conditions the private sector can hardly match. Public employment agencies are either at the federal, state, or community level or involved in such semipublic entities as social security, mandatory health insurance, public interest groups, unions, and religious administrations. They also may be in the entrepreneurial sector, as communities, states, and the federal government still engage in competitive business (e.g., real estate, housing, and even retail trade). This persistent government involvement has helped to keep unemployment in Austria at a rather low level for many years.
Government, management, and labour follow a wage-price policy that attempts to avoid social cleavages and strikes through cooperative participation in a joint wage-price commission. The representatives of the various segments of the economy—together with the chambers of commerce, agriculture, and labour and the federation of trade unions—have tried, with the active cooperation of the government, to coordinate wage and price movements. It is within this framework that collective bargaining takes place, and agricultural prices are also negotiated by the wage-price commission without infringement of the market economy.
The three important economic groups—labour, management, and farmers—have similar structures. Each has its own independent organization: the trade unions, the management association, and the farmers’ federation. At the same time, laws provide for semiofficial “chambers” for each group. This type of guild organization promotes cooperation in the governmental wage-price commission. Despite the divergent interests of the various groups, their cooperation has resulted in relative economic stability, and labour-management relations have remained unmarked by major crises.
Tax revenues are drawn chiefly from an income and wage tax and, in line with the countries of the EU, a value-added tax. Other sources of revenue include expressway usage permits, gasoline taxes, and one-time “environmental assessment” taxes on imported cars.