New report highlights ‘enormous economic value’ of Austrian wine
An in-depth study has shown that wine adds €3.8 billion and tens of thousands of jobs to Austria’s economy. Key industry figures hope it will spur the federal government to support the sector.
It is relatively simple to prove to an outside observer the quality of Austrian wine. The Austrian Wine Marketing Board has a well-oiled machine of international tastings, giving clear demonstrations of superior winemaking. Demonstrating economic impact, however, is rather less direct, instead trying to show long-term and large-scale effects that cannot simply be poured into a glass.
The trade body therefore instructed the Economica Institute of Economic Research to examine the economic benefits of Austrian wine production, with its results for 2023 just published. They show a headline figure of €3.8bn gross added value for the economy from Austrian wine. In breaking down the industry’s different influences, it has further delineated a complex picture of economic gain.
“The economic significance of wine extends far beyond what’s poured into a glass,” explains Chris Yorke, CEO of the Austrian Wine Marketing Board. “There is a whole economic ecosystem that revolves around wine, including the wineries themselves, tourism, the retail sector and the catering industry. It is this combination of direct and indirect effects that makes wine such an important driver of our economy,”
Wide-ranging impact
That headline figure is hugely significant in itself: €3.8bn equates to 0.9% of the country’s total economic output. Hospitality and on-trade businesses are the greatest beneficiaries, with Austrian wine adding €1.5bn of value added to that sector of the economy. Agriculture follows in the rankings, with added value of €390 million, or 7.5% of Austria’s total agricultural output. This is closely followed by the wholesale trade, which saw an uplift of €353 million in the year thanks to wine.
Those significant figures translate into employment opportunities. Wine is responsible, either directly or indirectly, for 68,000 jobs. That places it among the significant industries of the nation; for instance, the country’s large metal industry directly employs around 135,000.
“There’s more to the Austrian wine industry than hospitality and joie de vivre,” explains Professor Christian Helmenstein, CEO of Economica. “It also generates an enormous economic added value.”
This translates into benefits for all of Austria. It brings in money, for example, from visitors and tourists. The study found that 5% of holidaymakers in 2023 engaged in wine-related activities, with their spend up 18% compared to the average visitor.
Moreover, economic activity drives tax returns, and the entire nation benefits. These amounted to €1.2bn of taxes and levies, with the federal government receiving €403mn and state-level governments also earning substantial sums.
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According to Johannes Schmuckenschlager, Chairman of the Austrian Winegrowers Association, the wide impact of the wine industry should not be underestimated. “Viticulture is a lot more than just agricultural production,” he says. “It is an economic and social lifeline and contributes to the attractiveness of many regions.”
A call to action
In fact, the documented positive impact the economy is being used to push for a greater appreciation for the Austrian wine industry, as well as greater support from the government.
The study particularly focused on the four states considered the backbone of Ausrtian wine: Niederösterreich, Burgenland, Wien and Steiermark. These areas, it found benefitted particularly from uplifts in retail trade, hospitality, and tourism.
Moreover, with producers often being small scale, a focus on the local is essential. As Yorke explains: “In many regions, because of the particular geographic and climatic conditions, viticulture is the central, and often the only, form of value creation.”
There is, therefore, concern about the vulnerability of smaller winegrowing regions and smaller producers. In a competitive global wine market, their success is not guaranteed, and lack of business could easily lead to job losses, reduced income from tourism and a lack of identity.
Schmuckenschlager sees the report as a means of raising such producers’ profiles: “By demonstrating the value that they add, our aim is to increase appreciation of what more than 10,000 wineries, 95% of which are family run, do on a day-to-day basis.”
As for the end result, he hopes that politicians will recognise the positive impact that the industry has made, and work more constructively with growers and winemakers. That should be in the form of targeted support and investment, helping the industry face declining consumption, growing competition and record-high production costs.
“Now, more than ever before, we need politics and the wine industry to stand together,” he proposes. “A really desirable step would be for the federal government, which demonstrably profits greatly from income from the wine industry, to resume making a financial contribution to the Austrian Wine Marketing Board in the same way that the model wine-producing federal states do.”
It is a sentiment echoed by Yorke. With wine producers ever-more recognised for their quality, he wants to see investment hand-in-hand with that acknowledgement. “Their work constitutes both the foundation and the future, and it is deserving not only of appreciation but also of strategic support.”
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