EU-wide study shows strong link between IP and business success
Companies that own IP rights (IPR) generate 20% higher revenues per employee and pay 19% higher wages on average compared to their contemporaries, according to the latest joint EU Intellectual Property Office (EUIPO) /EPO report.
The study sampled more than 127,000 European firms across all 28 member states over the period of 2007-2019. Results show a consistent correlation between IP ownership and economic performance, considering patents, trademarks and designs.
Firms that own patents demonstrated the greatest performance boost, with 36% higher revenue per employee and 53% higher wages. This is followed by ownership of registered designs at 32% higher revenue and 30% higher wages. Trademarks demonstrated 21% higher revenue and 27% higher wages.
“This study... is yet another piece of evidence linking IP rights to economic performance,” said the executive director of the EUIPO, Christian Archambeau.
“This is especially true for small and medium-sized enterprises (SMEs) which form the basis of Europe’s economy. In a critical context for the majority of European businesses, these results underline the importance of making it easier for small companies to protect their innovations and creativity with IP rights, one of the major goals of our Strategic Plan 2025.”
SME’s potential for growth
While the study considered both SMEs and large businesses, results showed that the economic performance of SMEs benefited far more than their larger counterparts from IPR ownership.
SMEs that own any form of IP enjoy 68% higher revenue per employee than those without.
However, less than 9% of SMEs in Europe own any IP compared to more than six out of ten large-scale companies.
President of the European Patent Office, António Campinos said: “The stronger your IPR portfolio, the better your business performs. And IPR-owning businesses don’t just generate more revenue, their employees earn more, too.
“The study further demonstrates that there is significant untapped potential for SMEs in Europe, as it shows that they stand to benefit the most from owning IP.”
This report is a follow-up to a similar report published by the EUIPO in 2015. The latest edition updated the methodology and used data from all countries rather than just 12. The findings, however, remain consistent.
The two organisations also released a collaborative study in 2019 which demonstrated that IP owning firms represent a significantly larger proportion of economic activity and employment across Europe. One of the key findings of this study was that above-average use of IPRs contributed 29% of employment and 45% of GDP in the EU.
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