Austria wants to discriminate against EU workers

"That means - only if there is no suitable unemployed person in the country can [a job] be given to new arrivals without restriction," he said.

Kern was speaking in Wels, a town whose mayor hails from the right-wing populist FPO. The FPO has seen a historic resurgence in support despite narrowly losing the presidential run-off in December.

Kern's statement was made during a presentation of a 10-year economic plan, and aims to woo the anti-immigrant voters back into his social democrat party ahead of national elections.

But it also directly clashes with the free movement of workers, viewed as sacrosanct throughout much of the EU.

Articles in the treaty of the European Union uphold the right for any EU national to be treated on equal footing with nationals of that member states.

Kern's pledge would allow employers to discriminate against people based exclusively on nationality.

Austria's asylum cap

He also backed government plans to cut Austria's asylum application cap of 35,000 per year to 17,000.

The cap, first introduced in January last year, allows authorities to impose an emergency decree to turn away people at the border should the threshold be breached.

The 35,000 cap was not reached last year but the move to further reduce it was announced by the head of the People's Party (OVP), a junior member of the coalition government headed by Kern.

"We want to halve this cap, we want to reduce it to around 17,000," said OVP leader Reinhold Mitterlehner according to Reuters news agency.