Regional Pressure for Transformation - Economic Disparities in the Green Transition of Austrian Regions

Austria has committed to an ambitious transformation pathway with the aim of achieving climate neutrality by 2040. The necessary decarbonisation efforts particularly affect emission-intensive sectors such as industry, energy, and transport. However, in addition to innovation and efficiency gains, social and economic adjustments are also required to safe-guard employment and value creation in the long term. At the same time, the need for a transition towards climate neutrality results in varying degrees of regional impact, depending on sectoral structures. This so-called 'transformative pressure' is consequently particularly high in regions where the economy remains characterised by high energy and resource intensity.

Against this background, this study presents the first systematic analysis of the relationship between decarbonisation and employment in Austria. Essentially, the study aims to trace the development of sector-specific CO₂ emissions and employment across Austria's 35 NUTS 3 regions between 2011 and 2023, and to identify regional patterns and disparities in the green transition.

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Objectives

This study focuses on analysing how decarbonisation has so far affected economic and employment structures in Austria, what regional differences exist, and how regions particularly affected by the green transition are (or can be) coping with the challenges.

Methods

The study is based on a variety of methodological approaches:

Data analysis: Evaluation and comparison of CO₂ emissions, employment, and economic data at sectoral, national, and regional levels for the period 2011 to 2023. A particular focus is given to energy-intensive manufacturing industries and sectors under pressure to transform (especially the automotive industry), as well as the identification of regional impacts (across Austria's 35 NUTS3 regions).
Document and literature search: Supplementary analysis of literature and documents to contextualise the results of the data analysis against the backdrop of recent developments after 2023 – for example, declining industrial value added, the energy price crisis, and geopolitical turbulences
Regional case studies: Interview- and data-based case studies in four energy-intensive regions or those affected by the transition: Östliche Obersteiermark, Niederösterreich-Süd, Steyr-Kirchdorf, and Traunviertel. This includes contextualising statistical analyses and focusing on assessments of developments that have already taken place, challenges, opportunities, and best practices in the transition to climate-neutral industrial structures.

Results

At national level, there is evidence of successful decoupling, i.e. decarbonization accompanied by growth in employment and economic prosperity. As data on CO2 emissions at a small-scale level are not available, the emissions data were regionalised using regional employment data (shift-share analysis). The regional CO2 emissions determined in this way show a mixed picture: whilst the majority of regions were able to decarbonise successfully during the period under review, CO2 emissions are rising in some regions in the northern part of Austria. Overall, however, successful regional decoupling is evident, as there does not appear to be a systematic link between emissions reductions and losses in employment or value creation.

Although energy-intensive regions and those affected by industrial transformation face particular challenges (e.g. dependence on international raw materials and energy, a shortage of skilled workers and out-migration, and dependence on individual key sectors or companies), they also possess specific expertise, structures and potential in the economic and scientific spheres that enable them to shape this far-reaching transformation in a way that safeguards value creation.

Project team

Duration

10.2025-6.2026

Clients

Kammer für Arbeiter und Angestellte für Wien

Project