Industries that make an above average use of intellectual property rights (IPRs) such as patents, trademarks, industrial designs and copyright generate 45% of GDP (EUR 6.6 trillion) in the EU annually and account for 63 million jobs (29% of all jobs). In the UK, these IP rights-intensive industries account for more than 8.4 million jobs (28.1% of all UK jobs), and contribute more than EUR 1 trillion to the country’s GDP. These are among the findings of a joint report released today by the European Patent Office (EPO) and the European Union Intellectual Property Office (EUIPO) on the importance of IPRs for the EU economy between 2014 and 2016.

In the period under review, employment in IPR-intensive industries in the EU grew by 1.3 million jobs compared with 2011-13, while total EU employment declined slightly. The value added per employee in these industries is higher than in the rest of the economy. Accordingly, IPR-intensive industries pay significantly higher wages: on average 47% more than other sectors, with the figure rising to 72% for patent-intensive industries.

UK strong in copyright-intensive and trade mark-intensive industries

While the overall GDP contribution of IPR-intensive industries in the UK (42.6%) is slightly below the EU average of 44.8%, the country is above average with regards to copyrights and nearly on a par with the average when it comes to trade marks: The report reveals that the UK ranked no. 1 among EU countries for the contribution of its copyright-intensive industries to the economy. These industries generated over EUR 200 billion (8.4%) of the UK’s GDP (compared to EU average of 6.9%), and accounted for 2 million jobs (6.8%) in the UK (compared to EU average of 5.5%). Trade mark registrations are often indicative of future business success, establishing a company’s brand and underlining its distinctiveness in the marketplace. Trade mark-intensive industries in the UK account for some 6.4 million jobs (21.4%), the second highest number among EU countries, and EUR 890 billion (36.3%) of the country’s GDP.

Patent- and design-intensive industries also contribute to UK economy

With 12.9% (EUR 314 billion) and 11.6% (EUR 283 billion) respectively, the contribution of UK design-intensive and patent-intensive industries to the country’s GDP is also significant, although both are below the EU average (16.2% and 16.1% respectively). Design-intensive industries in the UK account for some 3.2 million jobs, which is the 4th highest figure among EU countries, after Germany, Italy and France. Some 2.5 million jobs in the UK can be attributed to patent-intensive industries. Based on the EPO’s Annual Report 2018, the UK was the 9th largest country for patent application at the EPO, with Rolls-Royce, Unilever and BT as the top 3 filing companies. The EUIPO lists the UK as the 6th largest filer of design applications in 2018.

Non-UK firms important to job creation in country’s IPR-intensive industries

The joint EPO-EUIPO report also looked at cross-border job creation by industries intensively using IP rights. With 27.8%, a relatively large share of IPR-intensive dependent jobs in the UK is attributed to non-UK firms. Some 730 000 of these jobs, more than one third, are created by companies from other EU member states. UK companies active in IPR-intensive industries are also important employers in other EU countries, where they create over 440 000 jobs or 8.3% of all EU cross-border jobs attributed to IPR-intensive industries. In terms of cross-border job creation, this puts the UK in third place after Germany and France. The top three industry sectors with regards to contribution of employment in the UK are sports activities and amusement and recreation activities, business and other management consultancy activities, as well as activities auxiliary to financial services and insurance activities.

The report is the third in a series that tracks the contribution of industries making an above-average use of trade marks, designs, patents, copyright, geographical indications and plant variety rights to economic growth and employment in the EU. Commenting on the findings, the Executive Director of the EUIPO, Christian Archambeau, said:

“Industries that use intellectual property rights intensively play a crucial role in making the EU more prosperous and in securing their economic future. These industries are more resilient in the face of economic crisis and more innovative. Our challenge is to ensure that all firms and entrepreneurs can secure their IP rights, particularly SMEs.”

The President of the European Patent Office, António Campinos, said:

“The importance of IPR-intensive industries reflects the strength of the knowledge-based economy in Europe. Businesses in these sectors often file bundles of intellectual property rights in combination to protect their intellectual assets. This strategy creates products and services with high added value, and in doing so helps secure Europe’s long-term competitiveness.”

Patents and drivers of economic growth

Looking at overall EU figures, the report finds that industries making intensive use of patents employ some 24 million people and generate 16% of the EU’s total GDP, and also looks at specific technology sectors. In climate change mitigation technologies (CCMTs), for example, patent-intensive industries accounted for 2.5% of employment and 4.7% of GDP in the EU in the period under review. The economic weight of CCMTs is expected to increase as countries work towards the goals set by the Paris Agreement. European firms already play a leading role in this technology sector, with nearly 10% of all patent applications at the EPO from EU applicants in recent years relating to CCMTs. The report also looks at the patent-intensive industries which make a major contribution to technologies of the Fourth Industrial Revolution (4IR) and digital transformation in the EU. It finds that these 4IR-intensive industries accounted for 1.9% of total EU employment and 3.9% of GDP in 2014-16, with both figures increasing compared to 2011-13. In terms of wages, 4IR-intensive industries pay more than double the average of non-IPR-intensive industries and 39% above the wage in all IPR-intensive industries.