The Information and Communication Technologies (ICT) sector is one of the most research intensive sectors in the EU economy, meaning that it has a high ratio of Research & Development (R&D) expenditure if compared to its value added (its revenues less materials and services purchases). This is one of the main findings of a new report by the Joint Research Centre’s (JRC*) Institute for Prospective Technological Studies (IPTS).

Also highlighted is that in 2009, the R&D intensity of this sector was more than four times the average of all business sectors in the EU (1.2%).

The report shows that in 2009 the ICT sector accounted for 17% of the EU’s total business R&D expenditure, while only representing 4% of the EU’s Gross Domestic Product (GDP). This share of GDP – stable over the last few years – amounted to a value added of € 470 billion in 2009 and represented over 6.1 million jobs.

Despite the decrease of R&D investment in the sector from 2008 to 2009 (-7%) and the loss of value added (-7.4%), it can be said that the R&D drive was stable, as the sector maintained an R&D intensity of 5.3% in 2009, very close to the 5.4% intensity registered in 2008. This R&D intensity positions ICT as a “high R&D intensity” sector, similar to pharmaceuticals and biotechnology or health care equipment and services, even at times of economic downturn.

Compared to the US however, the report found Europe lags in ICT performance. The US had 22 per cent higher profits from ICT in 2009, and its profit per employee in that area was double that of the EU.