The indicators in the table below present a synthesis of research, innovation and competitiveness in Austria. They relate knowledge investment and input to performance or economic output throughout the innovation cycle. They show thematic strengths in key technologies and also the high-tech and medium-tech contribution to the trade balance. The table includes a new index on excellence in science and technology which takes into consideration the quality of scientific production as well as technological development. The indicator on knowledge-intensity of the economy is an index on structural change that focuses on the sectoral composition and specialisation of the economy and shows the evolution of the weight of knowledge-intensive sectors and products and services. table6

Austria has expanded its research and innovation system over the last decade with investments in research and innovation growing more quickly than the EU average. These efforts have been translated into a high and growing level of excellence in science and technology and clear strengths in key technologies for energy, environment and transport. The Austrian economy is characterised by specialised niche players, which are in constant need of innovation, in particular technological innovation, in order to remain leaders in their market segment. The level of innovation in Austrian firms is hence relatively high. Overall, according to several indicators on trade, firm innovations and patent revenues from abroad, the Austrian economy is, partly for structural reasons, less knowledgeintensive than many other EU Member States.

However, the indexes on structural change and on the trade balance both point towards an upgrading of knowledge-intensity and linked to that an increase of competitiveness. Nevertheless, the efforts to boost research need to be maintained, given the specialisation of the Austrian economy in a limited number of knowledge-intensive sectors where international competition is strong. This includes for example transport technology, biotechnology and the energy sector. The economic crisis has hit Austria less than other Member States and the unemployment rate is currently the lowest in the EU. To maintain its competitiveness and hence its favourable economic position, Austria is depending on an on-going high rate of innovation. Austria's research and innovation policies are addressing these challenges by means of educational reform, improved governance of the R&D sector, by establishing new research centres of excellence, by setting up a more effective system of public research funding and more generally by promoting a further increase in the already high level of public and private investment in R&D. table7