Austria - European Semester Country Report
The high level of public research and development funding does not lead to corresponding innovation outcome. Austria ranks fifth in the EU 28 in terms of R&D spending as a percentage of GDP, and the share of the government sector in financing research and development is clearly above the EU average. However, the relatively high level of public R&D investment does not translate into corresponding innovation outputs and related economic effects, partly because of the relatively low level of cooperation between publicly funded research and business. There is scope for increasing the private sector’s participation in R&D, for stepping up knowledge transfer and efficiency in the supporting innovation. Public spending on R&D co-financed by private companies accounted for only 0.041% of Austria’s GDP in 2011, compared with an EU average of 0.051%.
While the intensity of R&D undertaken by businesses is above the EU average, the growth of innovative firms in their start-up phase is below the EU average (fast growing firms in 2012 represented only about 6% of employment in the business economy, compared with an EU average of about 9%). Austria is addressing the underperformance of its research and innovation system in a national research, technological development and innovation strategy adopted in 2011 (‘Der Weg zum Innovation Leader’). In 2014, Austria presented an overview of its smart specialisation strategy as part of the ex-ante conditionality, necessary to benefit from co-financing from the European structural and investment funds between the 2014 and 2020. The strategy is based on a small number of priorities. It provides information on the policy mix, explaining in particular how measures are tailored to the needs of small and medium-sized enterprises, and encourages private investment in R&D. A monitoring system (including the necessary coordination between regional and federal levels) is to be set up in order to assess indicators and how stakeholders are to be involved. To be deemed successful in boosting innovation performance, the smart specialisation strategy needs above all to promote investment by private business in research and innovation technology as well as in knowledge-intensive sectors and technology transfer.
Although particularly important to innovative firms, the markets for small-scale equity finance (notably venture capital) and those mobilising retail investors, such as crowdfunding, are still underdeveloped by comparison with other Member States.