IP-Intensive Industries Make Significant Contribution to European Economies

A new joint study by the European Union Intellectual Property (IP) Office and the European Patent Office entitled “Intellectual Property Rights Intensive Industries and Economic Performance in the European Union” finds that IP-intensive sectors make a significant contribution to European economies.

Here are some of the key findings regarding IP-intensive industries in Europe:

• IP-intensive industries generated 27.8% of all jobs in the EU during the period 2011-2013. On average over this period, 60 million Europeans were employed by IP-intensive industries. In addition, another 22 million jobs were generated in industries that supply goods and services to the IP-intensive industries. Taking indirect jobs into account, the total number of IP dependent jobs rises to 82.2 million (38.1%).

• Over the same period, IP-intensive industries generated more than 42% of total economic activity (GDP) in the EU, worth €5.7 trillion. IP-intensive industries account for approximately 90% of the EU’s trade with the rest of the world.

• IP-intensive industries pay significantly higher wages than other industries, with a wage premium of 46% over other industries. This is consistent with the fact that the value added per worker is higher in IP-intensive industries than elsewhere in the economy.

• IP-intensive industries have proved most resilient to the economic crisis. Comparing the results of this study with those of the 2013 study reveals that the relative contribution of these industries to the EU economy slightly increased between the two periods 2008-2010 (2013 study) and 2011-2013 (2016 study).

• The detailed analysis of the economic weight of industries engaged in the development of climate change mitigation technologies (CCMTs) shows that they account for 1.2% of employment and 2.1% of economic output in the EU. They generated a substantial trade surplus for the EU and, despite a small drop in employment, were able to increase their GDP contribution between the two periods 2008-2010 and 2011-2013.

This study supports what FSF scholars have stated for many years: strong IP rights protections encourage increased economic activity because they enable and promote creativity, innovation, and investment from artists and entrepreneurs throughout the entire economy. And, importantly, as the new European study shows, securing IP rights grows jobs and wages.